Republican gubernatorial hopeful John Oxendine has paid thousands of dollars for the door-knocking services of 150 home-schooled Christian teenagers in the run-up to this month's primary vote.
The teens are in Georgia at the request of state Public Service Commission candidate Tim Echols, who is the founder of the national nonprofit TeenPact.
A for-profit consulting company owned by Echols sold the TeenPact teens' grass-roots services to Oxendine, in an arrangement that is raising legal and ethical questions for the nonprofit group.
A former head of the tax-exempt division of the IRS said the arrangement could well violate two tenets of laws requiring nonprofits to avoid political campaign work. Two Oxendine rivals, too, said they were approached with the same deal but turned it down because they were concerned it was both distasteful and possibly illegal.
The teenagers are knocking on doors and dropping literature for both Oxendine and Echols. Echols is getting the help for free: He founded TeenPact more than a decade ago, and the kids are campaigning for him because they know him, he said.
The Oxendine campaign, however, paid $12,500 to a for-profit consulting company owned by Echols in exchange for the TeenPact kids' volunteer work. Before deciding to run for the PSC, Echols served as Oxendine's campaign manager.
TeenPact, which teaches home-schooled kids about government, is part of Family Resources Network, a Christian organization that Echols created in 1996. TeenPact kids come to the state Capitol during the legislative session each year to watch government in action.
Family Resources Network is a tax-exempt nonprofit and legally banned from campaigning for candidates. While the kids are TeenPact participants, they're not campaigning through or for TeenPact or Family Resources Network, Echols said. He said the kids are coming to Georgia from around the country on their own, because of their ties to him.
"The Oxendine campaign has hired my consulting firm, Gold Dome Consulting, to do a limited amount of grass-roots work," Echols said. "This includes dropping literature door to door. My team is dropping their [Oxendine's] literature and mine."
Echols said "most of the folks helping with the project are students, but this is not a TeenPact project. I have been paid a fee of $12,500, which will be on their [Oxendine's] disclosure this quarter."
"I have taken great precautions to ensure that no asset of TeenPact is used to aid any campaign, including my own. The IRS has strict rules that prohibit nonprofits from assisting campaigns, and I am in full compliance."
The IRS prohibition encompasses any activity "with evidence of bias" in favor of a candidate or group of candidates or in opposition to a candidate or group of candidates.
The IRS does not care if TeenPact was paid directly, said Marcus Owens, the former head of the tax-exempt division of the IRS.
"If it is a charity, if its assets, its facilities, its employees -- to the extent it has them -- are involved in a political campaign activity," then there could be a problem, Owens said.
If TeenPact computers, membership rolls, e-mail lists, vans, cars -- any asset -- are being used to organize the efforts or to support them, then the IRS would likely frown upon the arrangement, he said.
Janelle Kerlin, an assistant professor of public management and policy at Georgia State University, agreed.
"If they're out there campaigning for John Oxendine for governor, he [Echols] can't be doing that, and they can't be representing TeenPact," she said. "As long as he [Echols] doesn't relate it to the 501c(3) in any way, shape or form, he's OK. But, if he's using TeenPact buses to drive the teens somewhere or any resources are being used, even staff time, he's in trouble."
Echols approached other Georgia campaigns with the offer. Former state Sen. Eric Johnson (R-Savannah) is competing with Oxendine in the race for governor. But in spring 2009, Johnson was planning to run for lieutenant governor when Echols offered him a similar deal.
"Tim Echols directly approached Eric with a substantial financial ask in return for volunteers," Johnson spokesman Ben Fry said. "Eric has been a supporter of the TeenPact program and has worked with the kids at the Capitol. He was concerned that this might put the program in jeopardy and so declined the offer."
How substantial is substantial? "High enough that it didn't smell right," Fry said. "Tens of thousands."
Asked whether Echols wanted the money to be paid to Gold Dome or TeenPact, Fry said the conversation between the two never reached that point.
Echols also offered his services to the gubernatorial campaign of former U.S. Rep. Nathan Deal (R-Ga.), but Deal also turned him down, said Deal spokesman Brian Robinson.
Echols confirmed he talked to Johnson about providing volunteers during his bid for lieutenant governor, as well as other "conservative candidates," and was hired by Oxendine.
Echols wouldn't say what the Oxendine money was going for, but he did say the grass-roots outreach effort required a lot of gas.
Oxendine spokesman Stephen Puetz said the campaign saw nothing wrong with the arrangement.
"We paid him [Echols] a consulting fee for grass-roots activity," he said. "We paid him $12,500, to his Gold Dome Consulting."
Puetz said he understood that the grass-roots activity would be done by kids affiliated with TeenPact, but said the campaign considered them "just kids Echols knew."
Rick Thompson, former executive secretary of the State Ethics Commission, said it doesn't appear that Oxendine has violated the state Ethics in Government Act. But, Thompson said, Echols needs to be careful.
If the TeenPact kids are campaigning for both Echols and Oxendine, then both would have needed to have paid Gold Dome Consulting. If Echols' PSC campaign did not pay his own private consulting firm, then it could be considered that Echols' campaign is receiving an in-kind contribution from Gold Dome, which would have to be reported on his campaign finance disclosure report.
This isn't the first campaign cycle in which Echols has had this type of arrangement with candidates.
His teen volunteers campaigned for Gov. Bobby Jindal in Louisiana and for Ralph Reed's 2006 lieutenant governor bid here. In Reed's case, the candidate paid the teens' expenses directly.
Jim Terry worked with Echols when Terry was working for the National Republican Congressional Committee to elect Republicans to the U.S. House.
"He's got a bunch of kids," Terry said, adding that the NRCC would cover the kids' travel expenses and meals and the teens would volunteer for campaigns.
"They were certainly a tremendous help," Terry said. "All these little home-schooled kids. They've got a work ethic. They're not going to roll up to somebody's door with piercings and sagging pants. They say ‘ma'am' and 'sir.'"
Staff writer Jim Galloway contributed to this article.
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