Hannitized is Sanitized

March 19th, 2010 at 5:22 pm | 51 Comments |

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Debbie Schlussel posted a long piece last evening about a charity that Sean Hannity is affiliated with, accusing them of malfeasance and mismangement.

FrumForum has done an exhaustive investigation of the charity in question, Freedom Alliance, and found enough evidence to substantially rebut each of Schlussel’s claims. I’ll approach them one by one.


Schlussel Accusation: Sean Hannity improperly benefited from Freedom Alliance by charging private jets, hotel stays and luxury cars.

Freedom Alliance’s press release today stated categorically that they have “never provided planes, hotels, cars, limos, or anything else to Sean [Hannity] … to be clear Sean pays for all his own transportation, hotels, and all related expenses for himself and his family and friends and staff.” We are satisfied that this is true.

It is true that Freedom Alliance spent $60,000 on aviation services in 2006, but there is no evidence that this was for Sean Hannity’s benefit, and it seems unlikely that the money was used to lease a Gulfstream 5. Rates for G5 aircraft average around $8,000 an hour. $60,000 would not buy much at that rate.

We have also been able to confirm that Sean Hannity has no operational control over the organization. Nor is he even a member of the group’s board.

If Schlussel stands behind her statement, then she will have to do better than a quote from a blind source, who is, as she admits, a friend of a friend.


Schlussel Accusation: Too Little of Freedom Alliance’s Spending Has Gone to Program Outcomes.

FrumForum has intensively investigated Freedom Alliance’s 990 Forms, which have been submitted to the IRS and checked by an independent auditor.

Debbie Schlussel alleges that only $1 million of the organization’s $8.8 million in revenue was going to soldiers and scholarships in 2008. This figure is the product of a misleading and selective reading of the organization’s tax forms.

The numbers that Schlussel cite refer to direct financial transfers to individuals – that is, if there is a direct grant that Freedom Alliance gives to a soldier. This does not include all the positive work that doesn’t involve a direct grant.

Freedom Alliance also spends money on non-cash benefits for military families, involving things like taking soldiers to sporting events and sending care packages to troops.

The highest paid employee earned $152,000 in 2006. The second highest paid employee earned $83,000. In 2007, Freedom Alliance spent about $1 in $7 on salary and benefits.

Total staffing costs may seem high, but they are not out of line with what is spent at many other charities. For example, the Armed Services branch of the YMCA spent about $1 in $2 on salaries and benefits in 2008.


Schlussel Accusation: Soldiers Get Grants of Very Low Value

Schlussel is unhappy with “the fact that in each year’s tax returns soldiers described as having brain trauma injuries, multiple amputated limbs, and severe burns over most of their bodies get a few hundred bucks each from Freedom Alliance and in almost every case, no more than $1,000.”

However, this accusation is much weaker when you examine the Department of Defense regulations regarding donations to active duty soldiers.

According to the DOD Joint Ethics Regulation, gifts with a value of over $1,000 must go through a lengthy bureaucratic process which involves ethics officials. Calls to the Department of Defense confirmed this point.

What becomes clear is that there is a bureaucratic process to get approval from an ethics official, and that the costs of working through the bureaucracy for this purpose may want to be avoided by a charity, especially one that is working in a lot of other areas.

Schlussel also decries Freedom Alliance donations of less than $1,000, complaining for example that Freedom Alliance only gave $200 to a serviceman who lost both legs and his left arm. FrumForum has determined that lower-value grants like these are approved for specific purposes, often requested by a DOD case officer. This applies to cases where, for example, a serviceman may need a bus ticket home to visit his family.

The sums may seem small, but a soldier who is already receiving a government benefit may greatly value an airline ticket that goes above and beyond the Department of Defense’s budget.


Schlussel Accusation: Too Little Money Is Being Spent on Scholarships for Children of the Fallen

Schlussel complains that “167 students got an average of just $4,803.89 each in tuition.  With the amount this charity raises, these kids should all be getting a free ride paid for by Freedom Alliance.”

The scholarships that she is referring to are considered and approved annually, meaning that a freshman can qualify for about $20,000 over four years.

Further, $4,800 covers more than a year’s tuition at an average Catholic private school and a substantial portion of tuition at many colleges. For example, it nearly covers a year’s tuition at the University of Georgia ($4,900), and covers about a third of a year’s tuition at the University of Michigan ($11,600 for freshmen, $13,000 for upper-classmen).

Overall, Freedom Alliance raised $2.1 million for scholarships in 2008. About $800,000 of that went to scholarships for that year.  Schlussel claims that the remainder, “$1,238,636 – all of which was supposed to go to scholarships for these kids of the fallen – went to Freedom Alliance.”

FrumForum was able to confirm with Freedom Alliance that the $1.2 million that Schlussel cites did not go into the general Freedom Alliance revenues, but instead to the organization’s Scholarship Trust Fund.

Why didn’t Freedom Alliance spend all of its $2.1 million on scholarships that year? Considering your average active duty combat soldier is in his mid-20s, many fallen soldiers have children that are not of age to go to college. Saving a substantial part of funds is simply good planning – the process of funding children of the fallen will continue for fifteen to twenty years. The organization’s trust fund now stands at around $15 million.


Schlussel Accusation: Freedom Alliance’s Postage Costs Are Too High

Debbie Schlussel complains that Freedom Alliance spends too much on postage. Freedom Alliance’s listed cost for postage was $775,599 in 2008, which may seem high given their overall expenses. However, Freedom Alliance sends care packages to active duty soldiers in Iraq and Afghanistan, which explains a good deal of the cost behind the postage figure.

Comparing Freedom Alliance to other groups that specialize in sending care packages, Freedom Alliance’s expenditures seem ordinary. For example, Operation Gratitude is a group that specializes in “sending care packages addressed to individual Soldiers, Sailors, Airmen and Marines deployed overseas.” When reviewing their tax forms, FrumForum found that they spend similar amounts on postage. Operation Gratitude spent $773,680 in 2008; Freedom Alliance spent $775,599.


*  *  *


A day of hard work by Tim Mak and Noah Kristula-Green was able to debunk the charges Debbie Schlussel levied against Sean Hannity.

Tim and Noah worked through IRS forms and comparisons with other charities to conclude that Freedom Alliance does not spend the money it raises on lavish living.

There are other questions of course: After all, only a small portion of the money spent on tickets to “Freedom Concerts” is received by the Freedom Alliance. If say a $40 ticket yields a $4 donation to Freedom Alliance, we can’t vouch for what happens to the other $36. Some must pay for rent of the stadium for example. We have only the written record and what we could find by asking questions.

If people wanted to suggest that a concert is not a very efficient way to raise money for a good cause, they might have a point. The Washington Post reported in 2007 that many military charities spend too much on fundraising expenses.  If you were asking my advice about how best to aid wounded soldiers, I’d suggest you give to Fisher House.  That’s where President Obama chose to direct a good portion of his Nobel Prize money.

But we were dealing with a specific allegation – not of inefficiency – but of corruption. Schlussel charged that Hannity supported a lavish lifestyle with charitable gifts. And that’s the charge we think we have rebutted.

Posted at 7:25pm by David Frum


Follow Tim Mak on twitter: @timkmak

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