Foundation for the Carolinas under scrutiny over grants to anti-immigration groups

CHARLOTTE, N.C. (The Charlotte Observer) - The Foundation for the Carolinas is well known for supporting civic projects across the Charlotte area: It has worked to improve economic opportunity and handed out grants to area nonprofits, including some that support asylum-seekers and refugees.

Yet millions of dollars managed by the foundation have also bankrolled a network of anti-immigration groups, which are now drawing increased scrutiny as their proposals gain traction in the White House.

A Charlotte council on economic inequality, whose leaders include a number of prominent city officials, has urged the foundation to stop funding such groups.

So have some national organizations. America’s Voice, an immigration advocacy group, has demanded that the foundation stop handing over money to those organizations. In an August letter, it argued that the foundation is funding groups that are “fueling violence” and “undermining the fabric of American communities.”

“This is an otherwise reputable organization that’s helping to legitimize a nativist movement,” Frank Sharry, the CEO of the immigration advocacy group and the author of the letter, said in an interview. “ ... They’re financing a hateful agenda that’s leading to terror.”

An Observer review of the nation’s 10 largest community foundations found that the Foundation for the Carolinas is the only one that has channeled funds to anti-immigrant groups since 2015.

In its letter to the foundation’s board, America’s Voice pointed to one likely source of those funds: Fred Stanback, a conservation philanthropist from Salisbury who, according to records reviewed by The Charlotte Observer, has donated nearly $400 million in stocks to the foundation.

The foundation’s leaders said their policies prevent them from commenting on individual donors. Stanback did not respond to repeated requests for comment.

But documents and past media interviews point to his support for the country’s most influential anti-immigration groups: the Federation for American Immigration Reform (FAIR), NumbersUSA and the Center for Immigration Studies (CIS).

Those groups drafted and promoted the anti-immigration proposals at the heart of President Donald Trump’s agenda, including an end to birthright citizenship; the construction of a wall along the U.S.-Mexico border; and greater limits on legal immigration, such as a rule that will limit visas and green cards for poor immigrants.

As mounting scrutiny of those policies — and their backers — embroils one of Charlotte’s most influential organizations, it raises weighty questions about the line between legitimate political speech and bigotry. Are any stances so extreme that they must be entirely discarded — or de-funded?

While the foundation’s board members have debated that question over the past year, president and CEO Michael Marsicano said, they see themselves leading a “big-tent organization” that works with donors of all political leanings, who support a range of causes.

“We have multiple different viewpoints in the family of funds, and I think that makes for a healthier community,” Marsicano said in an August interview with the Observer. “Philanthropy is a form of freedom of speech, and I don’t think any institution should be cutting off freedom of speech on fund-holders. If we did, where would it stop?”

The Foundation for the Carolinas makes two types of donations: There are charitable grants the foundation itself gives to local nonprofits. None of that money has gone to anti-immigration groups, Marsicano said.

But in most cases, its donors determine where the money goes. The foundation channels these “donor-advised” funds to any organization recognized as a nonprofit by the federal government — as is the case with FAIR, CIS and NumbersUSA.

A DECADE OF DONATIONS

Between 2006 and 2017, the foundation funneled more than $20.4 million in donor-advised gifts to at least nine organizations that campaign for limits on immigration, according to an Observer review of publicly available financial records. All of them are nonprofits accredited by the IRS.

About 85% of that money went to NumbersUSA, CIS and FAIR. John Tanton, a Michigan ophthalmologist who died in July, helped found all three groups.

Two of the three organizations, CIS and FAIR, have been designated as “hate groups” by the Southern Poverty Law Center. All three have worked closely with each other — as the policy think-tank, lobbying and campaigning arms of Tanton’s push to reduce both legal and illegal immigration to the United States.

The foundation’s biggest annual donation to one of these groups — $3 million to NumbersUSA’s education and research arm in 2015 — made up almost half of that organization’s operating budget for that year. That group did not return calls requesting comment.

Mark Krikorian, the executive director of CIS, said that Sharry’s letter to the foundation board was part of a “smear campaign” to prevent groups that oppose immigration from being able to participate in democratic discourse.

“Any group not engaged in any kind of illegal or violent activity gets to say what they want,” he told the Observer. “If you have a problem with it, call the IRS.”

While these groups have long played a role in the nation’s immigration debate, their proposals have never been so close to being implemented — and they’ve never been so close to the people enacting them as policy. Multiple current or former Trump administration officials, including Stephen Miller, Kellyanne Conway and Jeff Sessions, have close ties to FAIR.

“I don’t see any of these organizations helping people in need,” said Andres Lopez, a Charlotte lawyer who argued a case used by Sessions to limit grounds for asylum. “I see them as destroying the lives of people in need.”

Donations from the Foundation for the Carolinas to FAIR, NumbersUSA and another group, Californians for Population Stabilization, reached their peak in 2016, financial records show.

No money was channeled to those groups in the following year, the most recent year for which financial records are available. The foundation refused to say why. But donations in the thousands to CIS and a smaller group, Progressives for Immigration Reform, continued.

Leading on Opportunity — a group Marsicano helped launch which is working to improve economic mobility in Charlotte — has also appealed to the foundation to stop giving to such groups. At a 2017 meeting, members of the group told Marsicano such donations were hurting Charlotte’s growing immigrant community, according to a person who attended that meeting and asked not to be named.

(The council now counts a number of prominent executives and at least four local government officials among its members.)

Ryan Pitkin, the editor of Queen City Nerve, an alternative publication based in Charlotte, tweeted on Tuesday that he had backed out of speaking on a media panel at the Foundation for the Carolinas after learning about the foundation’s donations to anti-immigration groups.

Sharry’s letter to the board, which called Tanton a “white nationalist and eugenicist,” also drew parallels between those groups’ rhetoric and a white nationalist manifesto that has been linked to the alleged shooter in the Aug. 3 El Paso massacre.

Dan Stein, president of FAIR, said that Sharry’s letter constituted a “divisive” and “vicious” form of donor harassment that attacked the free marketplace of ideas.

He charged that there was an even greater network of donors funneling vastly more money into pro-immigration groups like America’s Voice, and said that FAIR and other groups on his side of the debate did not go after their funders.

“They should try to win this debate on its merits,” he said, “and if they can’t win on the merits, they need to shut up.”

FROM ENVIRONMENTALIST TO ‘A MAJOR DONOR’

Stanback, the environmental philanthropist, long had a relationship with Tanton and the causes and groups he advocated for: According to memos and letters written by Tanton, Stanback had donated hundreds of thousands of dollars to his various efforts by the mid-1990s.

Stanback also appears to have had a relationship with the Foundation for the Carolinas: In 2014, he gave the foundation $397 million in Berkshire Hathaway stock, according to financial records reviewed by the Observer.

Stanback also gave money to FAIR, NumbersUSA and Progressives for Immigration Reform, according to a 2013 story in the LA Times.

Stanback, 89, who was raised and still lives in Salisbury, inherited his family’s headache powder fortune and served as the best man at Warren Buffett’s wedding. His primary concern, according to Tanton’s memos, was about preserving the natural environment — issues like hog waste from N.C. farms creating algal blooms and killing fish.

That became evident in Stanback’s philanthropy: His donations have helped protect some of North Carolina’s most iconic landscapes, including properties along the Blue Ridge Parkway and two tourist attractions that became state parks, Chimney Rock and the wild back-country of Grandfather Mountain.

Like some other wealthy conservationists, Stanback’s passion for conservation led him to an interest in population control — and then, in keeping immigrants out of the U.S.

“He was a conservationist from an early age, and soon figured out that population was part of the problem,” Tanton wrote about him in a memo, calling him an “engaging and polite southern gentleman.”

The two men met at least three times in person in Salisbury in the 1990s, when Tanton had already become a fervent campaigner for anti-immigration causes. Roy Beck, the founder of NumbersUSA, came along for one such visit.

Stanback “should be considered for membership on the FAIR board,” Tanton wrote in one memo. “He is a major donor.”

Stanback also appeared to support the cause in other ways. A program he established at Duke University sent environmental studies students to summer internships at FAIR, CIS, NumbersUSA and Progressives for Immigration Reform until 2013, INDY Week reported.

WHAT CAN — AND SHOULD — THE FOUNDATION DO?

Established in 1958, the Foundation for the Carolinas has more than $2.5 billion in charitable assets. Of the $315 million in donations made last year by the foundation, about 6% was passed on to local nonprofits chosen by the foundation itself.

These so-called “discretionary dollars” have gone to fund scholarships for “Dreamers” who were brought to the country illegally as young children, alternative identification for undocumented immigrants, and legal aid for unaccompanied children arriving in Charlotte from the border, among other causes, a spokesperson said.

The Foundation for the Carolinas also partially funds a Report for America reporting position on affordable housing issues at the Observer. But the foundation has no influence over the Observer’s journalism.

Donations to anti-immigrant groups

Funds administered by the Foundation for the Carolinas from 2006 to 2017, the most recent year for which data is available.

The rest of the money counts as “donor-advised funds,” meaning that the donors who gave the foundation the money get to say where it goes. That’s how the Foundation for the Carolinas ended up funding progressive groups like Planned Parenthood, the ACLU, the SPLC and the Southern Environmental Law Center — as well as anti-immigrant groups like FAIR, CIS and NumbersUSA.

The Community Foundation Public Awareness Initiative, which lobbies on behalf of FFTC and similar institutions in Washington, found in a survey that about two-thirds of 62 community foundations have similar policies: They will pass money on to any nonprofit that’s accredited by the IRS.

But eight of the foundations that responded to that survey in March said they were reviewing their policies in light of recent events. And Aaron Dorfman, president of the National Committee for Responsive Philanthropy, a progressive advocacy group, estimated that about 40 to 50 community foundations are engaged in similar discussions about if and where to draw the line.

Todd Mansfield, who chairs the Foundation for the Carolinas’ board, said in an interview that board members have also discussed changing the policy, but ultimately decided to stand behind it. The foundation will continue passing on funds to any organization that’s accredited as a nonprofit by the IRS, he said.

“It’s a pretty slippery slope when we start overlaying our judgment on the wishes of our fund-holders,” Mansfield said.

But Dorfman said that foundations must stop administering money to causes that seem incompatible with their values.

“There is no such thing as neutrality on this,” he said. “You can’t be a ‘big tent’ for your community if you’re facilitating harm on some members of your community. That’s exactly what’s happening here.”

Laurie Paarlberg, an Indiana University professor who studies community foundations, said that these organizations technically have legal control over what happens to the money they manage — but generally avoid placing restrictions on donors.

One of a handful of exceptions: The Marin Community Foundation in California, which requires every organization it funds to certify that it has a nondiscrimination policy in place, according to the foundation’s president, Thomas Peters.

“I still consider us to be operating under a big-tent principle,” Peters said, “but a big tent needs poles.”

Mansfield said the board had previously received scrutiny from some conservative groups about channeling funds to environmental nonprofits and LGBTQ groups. In those cases, the foundation’s board came to the same conclusion.

“What some people consider to be problematic,” he said, “other people do not, and vice versa.”

And Marsicano, the foundation’s CEO, said money from the foundation can be used to support players on opposite sides of a debate.

“The word ‘community’ means all different views in a big tent,” he said. “We as an agency believe we can live intellectually honestly in both of those spaces.”

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