IRS Complaint Suggests Tennessee Charter Center Shouldn’t Be Tax Exempt

The IRS has been asked to “examine” the lobbying practices of the Tennessee Charter School Center to make sure it still qualifies for tax-exempt status. Credit: Ray Tsang via Flickr

Labor groups in Nashville are taking a high-profile swipe at charter school advocates.

Union organizations – including the SEIU – have filed a complaint with the Internal Revenue Service. The letter suggests the Tennessee Charter School Center is just a bunch of lobbyists and shouldn’t qualify for tax-exempt status.

To be a 501(c) (3) non-profit, less than 15 percent of an organization’s spending can go toward lobbying government officials. In a letter to the IRS, a group called Middle Tennessee Jobs with Justice points out that the Tennessee Charter Center has eight registered lobbyists. They include a third of the organization’s staff, along with big-name contract lobbyists.

CEO Greg Thompson says he’s well aware of the 15 percent rule and that his organization is nowhere near the limit.

“I’m registered, but I spend probably less than five percent of my time actually doing anything related to lobbying,” he says. “There are several other folks who fit that same bill.”

All the same, labor groups want the IRS to examine lobbying practices of the group, which – after several years – was able to establish a statewide charter authorizer. It will be able to open charter schools that have been denied by local boards.