WNYM on WBEN with Joel Rose

30 Jul


This morning, Dr. Kevin Hardwick was hosting the “Tom Bauerle Show” on WBEN 930AM and featured as his in-studio guest, Joel Rose of CACGEC, CAGNY Action, LLC., and CAGNY, Information, LLC.

I called in to ask Joel a few questions about statements he made on the show and in various responses to our questions on the Buffalo Issue Alerts email list, BuffaloPundit’s blog, and in other forums.  I would link to the podcast of this segment, but WBEN still does not save their shows for Internet broadcast and I wasn’t in a place where I could record the call.

For some reason, the public seems to have accepted as fact that the Wendt Foundation was wholly unaware that their sole $120MM investment fund included $4MM of stock in Harrah’s Entertainment Corporation during a three year period.  I made the mistake in my haste by claiming that this investment represented 10% of the foundation’s holding, but, 3% is still a sizable portion of the fund.  For the trustees of the Wendt Foundation to claim that they were unaware, indicates a violation of their fiduciary responsibility to the fund.  The counter to this argument seems to be that Joel and Dr. Hardwick aren’t sure as to where the money in their TIAA-CREF funds are invested.  First of all, you should know where your retirement funds are invested and the comparison is false anyhow.  If your SOLE paid responsibility (at $1384 per hour) is to manage the assets of a charitable foundation, you have a responsibility to know where and how it is invested.

Now, through Joel’s protestations that his organizations are not beholden to me or anyone else, my counter is that if his organizations and those which he is affiliated with wish to take legal action which affects a regional population of nearly 1 Million people, they owe us transparency.  Transparency on the sources of their funding, the manner in which that funding is distributed, and to whom that funding is eventually distributed.

I asked Joel if his organization, which is a not-for-profit domestic corporation registered in New York State, was willing to open its books in regards to the prosecution of this lawsuit.  After all, they are the lead plaintiff in the lawsuit.  He declined.  He says that he is unwilling to open up his donors to inspection from the public and not be “grist for the Chris Smith mill”.  If Julius Olmsted the IX of Woodward Avenue gave $50 to the group, you won’t find that on a Form 990.  If Mr. Olmsted were to have given $50,000, that would be on the document.  We would also know if this person had any personal stake in the eventual defeat of a Buffalo casino.

When you are a not-for-profit corporation, you need to disclose your funding streams and your activities via an IRS Form 990.  Would this open up his individual donors to the public microscope?  No, we’re interested in the finances of his organization specific to the lawsuit.

What’s this?  None of his three organizations have filed for tax exempt status in New York State and thus are exempt from filing any reporting documents?   They operate as a program of the Network of Religious Communities in Western New York and due to that organization being faith-based, they are exempt for reporting requirements through the IRS.  While I have been looking into non-profit law to assess how that process should and does work under the proper circumstances, I haven’t reached a conclusion.  However, the people have a right to know how the NRC has managed the funds received from the Wendt Foundation and other donors specific to the prosecution of the lawsuit.

The public has a right to know about the motives, finances, and structure of the organizations that are creating and affecting policy in our region.  Will the NRC and Joel Rose’s three organizations, open their books for the public?

So far, Joel says no.  Perhaps that will change as this process continues apace.

12 Responses to “WNYM on WBEN with Joel Rose”

  1. LC Scotty July 30, 2008 at 11:14 am #

    I listened to the first 10 minutes of Hardwick’s broadcast, and I could just feel Rose’s sanctimony spraying from my speakers.

  2. Kevin Hardwick July 30, 2008 at 11:39 am #

    The entire 3 hour show is slated to be rebroadcast Sunday night beginning I think at 7 pm (or maybe it’s 8 pm).

  3. Prodigal Son July 30, 2008 at 12:59 pm #

    The religious exmeption to non-profits is pretty specific. It allows organized religions (i.e. Protestants, Catholics, Jews, Muslims) to run relgigious organizations to do things religions traditionally do – hold services, run soup kitchens, host day cares, have Bingo, etc. Religions do not traiditionally file multi-million dollar lawsuits to fight Indian Tribes on sovereignty rights. While it may not be technically illegal, it is getting extremely close, and its pushing the relgiious exmeption to its absolute limit.

  4. mike hudson July 30, 2008 at 1:07 pm #

    keep going chris. this house of cards was apparently not too sturdily constructed and is falling down in front of our very eyes.

  5. hank July 30, 2008 at 2:29 pm #

    Geek wrote:they owe us transparency

    Hate to break the bubble, pal–but a private foundation don’t owe you shit. If the courts or the Justice Department wants a look, they have the power of a subpoena. A liberal blogger is neither the former or the latter.

    I know who you are, but who the hell do you THINK you are?

  6. WNYer July 31, 2008 at 2:15 pm #

    Hank says:”I know who you are, but who the hell do you THINK you are?”

    I’m not sure you or any of us really know who Geek is and that question really summarizes to me a big problem for Western New Yorkers. He is just your everyday tax-paying citizen. Isn’t that enough to warrant some sort of transparency from the very small group of people who are making decisions on this issue which effect ALL of us? To sit back and think who am I to question any of our decision makers has made Buffalo and Western New York what it is today.

    I’m glad Geek, Pundit and WNYMedia have the courage to ask some questions while the rest of the “reporters” in this town just roll over.

  7. Buffalo Hodgepodge July 31, 2008 at 8:17 pm #

    Besides, what’s with the liberal blogger comment? In addition to being wholly irrelevant, Geek’s the furthest thing from a “liberal.” He happens to be a Native American sovereignty supporting, casino-loving freak but he’s no liberal.

  8. Christopher Smith July 31, 2008 at 8:36 pm #

    Damn straight I’m not a liberal. I’m a pragmatist who leans right on almost every fiscal and taxation issue in the public domain. I lean left on social issues. I’m no different than most people in the country.

    “Labels disable”

  9. Joel Rose August 2, 2008 at 8:09 am #


    You always manage to get things twisted.

    (1) The primary responsibility of the Margaret L. Wendt Foundation Trustees is to disburse funds to wothwhile organizations and activities. They also have responsibility for managing the assets of the Foundation, but they largely delegate that function to a consultant.

    (2) Whether I know what the thousands of stocks in my retirement mutual funds are is not up to you, so your lectures about what I “should” do mean nothing to me. To me, that’s one of the reasons to have mutual funds, so that you have experts to manage the money. That’s not the way I choose to spend my life. In fact, I don’t know anybody who has CREF funds who has attempted to know what each of their holdings are. I do fret about the relative merits of the various mutual funds, but not individual stocks.

    Please read this carefully: The two CAGNY not-for-profits are not tax-exempt, but then we don’t claim tax-exemption for them, and donors may not claim a deduction for contributions. They have NO relationship to the Network. Your claim that they are part of the Network is 100% wrong, and I wonder where you got it. The most money CAGNY-action has ever had at one time was about $16,000. CAGNY-information does not have a bank account, and does not spend money. Again, the reason for the two organizations is to have a vehicle to create a 501(C)(3) and a 501(C)(4), but we have not done it yet.

    While CACGEC, as part of the Network, is tax-exempt, I don’t recall our ever having mentioned that fact to donors, with one exception. I told you before that we had one donation which, for us, was huge. It was for $5000. I explained our tax status, as best I understood it, to the donor. But he didn’t need the exemption, so it wasn’t used in that case. Since most of the donations are small ($20 would be typical), I doubt that many of the donors ever bothered to take a deduction.

    What you seem to fail to grasp is that we don’t focus on our tax status. Our mission is to fight casino gambling in Erie County. Being part of the Network means we don’t have to deal very much with administrative matters. We worry about money when we’re out of money. We do comply with the rules that the Network is required to comply with. E.g., as a group we don’t endorse political candidates. Note: Alan claimed on WBEN that he had sought our endorsement. That was a misunderstanding on his part. If you check our website, we recorded the candidates’ remarks and provided written summaries. That information pretty much speaks for itself, but it is not an endorsement.

    As individuals, of course, we do support candidates, often at cross purposes. We haven’t given up our first Amendment rights.

    Now, if you think that housing us is somehow inconsistent with the Network’s mission, take that up with the Network. I don’t speak for them, I’m not on their board, I don’t have access to their financial records except as they pertain to CACGEC, and then only indirectly, by request.

    (3) As far as opening up our books as regards the lawsuit goes, I will repeat, we haven’t paid the attorneys. The Wendt Foundation’s money has not been funneled through CACGEC, not a penny of it. We did pay Richard Lippes when we first filed the case. I’m pretty sure our payments to him totalled less than $10,000. It came from our general funds, made up, as I’ve said, of small donations. Money being fungible, I couldn’t identify which donations went to the lawsuit even if I were so inclined, which I’m not. I would, of course, authorize the Network to share our financial information with proper authorities, as required by law. I’m not sure they’d even need our authorization. But I wouldn’t even ask the Network to share our information with a blogger, liberal or conservative, friend or foe. It’s just not anybody else’s business who has given us money.

    It is not that we have anything to hide. During every one of our meetings, you could have attended as a neutral observer if you had so requested. We have often had journalists in attendance. If there had been any interest, reporters could have been present for any vote at which the disbursement of money was at issue. We would not allow an openly hostile observer, so you would not be welcome now.

    (5) Your argument that we owe transparency because we have taken legal action is novel, but not at all persuasive. Actually, in this comment and elsewhere, I’ve provided a great deal of transparency. But I’m not about to disclose the names of little old ladies who have sent in their $10 checks. It’s just a silly request. The $1.9 million that is of such great interest to everybody was not our money. We never even got to touch it as it whizzed by. But to get back to your argument, when you claim somebody “owes” something, you really ought to be on solid legal ground. If that’s supposed to be some sort of moral argument, coming from someone who’s been doing nothing but slinging mud, it rings kind of hollow.

    (6) The remarks above pertain to CACGEC, the program of the Network of Religious Communities.

    CACGEC, the not-for-corporation, was created as a first step toward creating an independent 501(C)(3). We never got beyond that first step, as other priorities intervened. CACGEC, the corporation has not money. It does not even have a bank account. There is no financial information to disclose. We don’t use the corporation for anything, although we may in the future. I doubt that many CACGEC members even know it exists. Again, I’ve said all that before, but you were too busy blathering about what you think my obligations are to notice.

    (7) The motives? Read our brief mission statements, which are incorporated in our bylaws, which are on the web. CACGEC’s mission statement is our motive. If any of our members have some sort of secret motive, I am not aware of it. Some, of course, are business people who are worried that a casino would hurt their business. Would you claim that such a concern is somehow illegitimate?

    Okay, I’m done. I’m sure you’ll continue to ignore what I’ve said and make your broadside accusations. Knock yourself out.

  10. Buffalopundit August 2, 2008 at 6:26 pm #

    1. The issue isn’t about who gave to CACGEC. Frankly, I couldn’t care less who gave that group its funding. The real question is: why is the Network funneling Wendt money to the CBB to pay lawyers handling a case to which the CBB is not a party.

    2. If CACGEC had 16k in an account at some point, it was probably supposed to pay tax on it.

    3. The Wendt 990 shows disbursements exclusively to nonprofits for specific, applied-for purposes. Here, the money was for a for-profit law firm, but was funneled thru 1 or 2 nonprofits for appearance’s sake. Why? Did the Network make the same sort of application as, say, the Food Bank or Studio Arena?

    4. Rose does himself no favors with his condescending attitude. Also, since he quite obviously is both ignorant and indifferent to the questions being asked, I have no idea why he continues to respond. CACGEC is quite beside the point.

    5. Why are mutual funds and 401(k) accounts still being used as comparatives to what Wendt did with respect to Harrah’s? Wendt owned that stock individually, not as part of a mutual fund. Let’s cut right through that BS once and for all.



  1. Buffalo Pundit » Blog Archive » Questions, Questions - July 30, 2008

    […] Also see what Buffalo Geek has to say about his call to Joel Rose on Hardwick today. […]

  2. Buffalo Geek » Blog Archive » Who Do I Think I Am? - July 31, 2008

    […] my post about the Wendt foundation and the need for transparency on the casino lawsuit issue, long time reader and commenter Hank, asked the following question: Hate to break the bubble, […]

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