Iowa Conservatives Took $3 Million in Tax Funds

IOWA CITY, Iowa -- A conservative group that has brought a string of potential presidential candidates to Iowa to lecture about the need to reduce government spending owes some of its past success to generous federal grants, which it has since rejected amid charges of hypocrisy.

The Family Leader has organized multicity forums for Reps. Michele Bachmann and Ron Paul, former Minnesota Gov. Tim Pawlenty and former Sen. Rick Santorum. Each has called for reining in federal spending and talked about family values.

The same group received more than half of its funding from federal grants over a five-year period when it operated under a different structure as The Iowa Family Policy Center. The group was among those that benefited from former President George Bush's faith-based initiative, which made it easier for social and religious organizations involved in community work to win federal funding.

The organization defends taking the grants, the bulk of which helped provide marriage mentoring for couples, but decided last year to turn down the final $550,000 in grant money and operate free of government involvement. In all, the group had accepted more than $3 million in federal grants since 2004.

"We wanted to be consistent in calling for more efficient, smaller government and came to the conclusion that would best be served by not taking funding from the feds on this," said group spokesman Chris Nitzschke.

The group in November changed its name to the Family Leader under a reorganization that put former Iowa Republican gubernatorial candidate Bob Vander Plaats in charge. Its leaders played a key role in the successful campaign to oust three Iowa Supreme Court justices last year over a ruling that legalized gay marriage. The new group is now trying to flex its political muscle in the lead-up to the Iowa Caucuses in January.

Two more potential GOP nominees, former business executive Herman Cain and former House Speaker Newt Gingrich, are on the group's calendar.

"We begin our pro-family policy agenda by cutting spending, and then we cut taxes," Bachmann said at one event in April. In March, Paul told the group that society had grown too dependent on the federal government and "we're at a point now where we can no longer afford it." Pawlenty said in February that, to the extent government has to be involved in an issue, it must deliver good value for taxpayers.

Edward Failor Jr., the former president of Iowans for Tax Relief, criticized the group's credibility on tax and spending issues during last year's gubernatorial campaign because of the millions in federal aid. He praised its decision to reject the final year of the grant, saying that marriage mentoring is a service that churches and other groups can provide without government aid.

"I think they did it to be intellectually consistent and honest. Good for them for doing that," Failor said. "As soon as you start taking money out of taxpayers' pockets, you are beholden to the government in one way or another."

Records show the policy center was awarded a five-year grant worth $550,000 per year from the Health and Human Services Department in 2006 to promote healthy marriages. The money went to a program it operates called Marriage Matters, which claims to have saved hundreds of marriages through its mentoring and counseling programs.

The policy center on Sept. 30 received its last $12,600 installment from the grant, which came from $150 million Congress set aside in 2005 to promote healthy marriages and responsible fatherhood. But as criticism of the group for receiving tax funds was mounting among both liberals and conservatives, Center President Chuck Hurley notified the federal agency in August the group was relinquishing the money and would operate with private funding.

Watchdogs, including the American Civil Liberties Union of Iowa, had questioned whether federal tax dollars were being spent to further a conservative religious agenda. One liberal activist had encouraged same-sex couples to seek counseling through the group to find out whether they would be served. Some conservatives, including members of the tea party, were critical of the group's leaders for taking the federal money.

Nitzschke said the programming offered by Marriage Matters has been scaled back but some services are still being operated privately.

At the same time, he said the grant money was well spent, with more than 1,200 individuals receiving services every year. He said that none of the tax dollars went to fund anything religious or political in nature.

A 2008 audit by the Government Accountability Office faulted HHS for a lack of oversight in how the marriage and fatherhood grants that went to dozens of groups were awarded and managed.

The policy center's tax disclosure for the one-year period through Sept. 30, 2009, the most recent available, shows it received $549,443 in government grants out of revenue just over $1 million. Nitzschke said the Marriage Matters program was directed by former center vice president Mike Hartwig, who earned part of his salary through the grant even as he was a prominent opponent of gay marriage. Hartwig called the 2009 ruling that legalized the practice in Iowa sickening.

Nitzschke said the bulk of the money was spent on contracts with individuals across the state to deliver services. At first he promised to release to The Associated Press annual audits of the grant money that he said found no problems, but he later reversed course and said the group considered that information private.

Randall Wilson, legal director for the ACLU of Iowa in Des Moines, said he wanted a more detailed accounting of how the money was spent and how much went to its administration. He questioned just how much mentoring the grant helped pay for, saying his group's limited investigation of Marriage Matters found it gave out money to churches and to host some events for couples.

"The danger always is that federal taxpayer money gets diverted to advocacy causes. I think one could argue that not all taxpayers agree with Iowa Family Policy Center," Wilson said. "That, of course, is a big concern of ours. The center was instrumental in removing three Iowa justices."

In addition to the marriage grant, the policy center accepted $800,000 in 2005 to build its organizational capacity under the Compassion Capital Fund, a key part of Bush's faith-based initiative. The group received $50,000 the previous year from a related federal grant program to promote marriage.