Federally funded front group misleads IRS, taxpayers, lawmakers

It’s a stunning admission: the Internal Revenue Service targeted conservative groups for special scrutiny in the run-up to the 2012 election. But equally stunning is who the IRS wasn’t targeting: a federally funded labor union front group that was boasting publicly of its lobbying activities while failing to report them to the IRS’s bookkeepers.

The Restaurant Opportunities Center (ROC) has made a name for itself by claiming that the restaurant industry systematically mistreats its employees and routinely breaks rules and laws in the process. To make its point, it has sued high-profile restaurants, organized raucous and sometimes-violent protests, and even hosted press conferences on Capitol Hill.

How ironic, then, that it’s actually ROC that’s in violation of federal rules. ROC has a long history of lobbying at the local, state, and federal levels — yet ROC has consistently failed to fulfill its obligation to report such activities to the IRS.

ROC’s factual oversight is well in keeping with the organization’s agenda and history. Since its founding in New York in 2002 by the hotel employees union, ROC has operated as a union front group intent on “organizing the 99 percent of the [restaurant] industry that doesn’t have a union.” In many ways it works to accomplish this goal in the same way that unions behave — it makes exaggerated claims in a very public way against their target in an effort to pressure them to capitulate.
 

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But “corporate campaigns” aren’t the only way ROC looks to pressure their target. Lobbying is an integral part of this strategy. Its lobbying activities to date have all aimed at the same end — burdening restaurants with government mandates like minimum wage hikes and mandatory paid leave.
 
Each year, for instance, ROC hosts and boasts about its "Counter Lobby Day" in Washington, D.C., where its representatives meet with Congress and lobby for its favored policy goals. This past April, ROC lobbyists met with Reps. George Miller (D-Calif.) and Donna Edwards (D-Md), and Sen. Tom Harkin (D-Iowa) to push for a higher minimum wage — a proven job killer for entry-level and low-skill employees.
 
ROC spokespersons have also previously lobbied the federal government on behalf of the WAGES Act, and “spearheaded” mandated paid leave and minimum wage legislation at all levels of government. In Illinois, ROC lobbyists met with no fewer than 23 state senators to push for a higher minimum wage. Meanwhile, during recent mandated paid leave battles in New York and Philadelphia, ROC lobbyists were near fixtures pressing its union position before City Council.
 
ROC, which is legally registered as a 501(c)(3) tax-exempt nonprofit charity, has failed to report any of these lobbying activities to the IRS, as required by law. The government requires that nonprofits like ROC report their lobbying activities for a very specific reason: It’s a cornerstone of democratic government that the general public be aware of who’s trying to influence their elected representatives.
 
ROC’s evasion of the rules is even more notable in light of ROC’s receipt of taxpayer money. Since 2005, ROC has received more than a million dollars in federal funding via the Department of Labor’s “Harwood Grants” program and the Centers for Disease Control and Prevention’s “Racial and Ethnic Approaches to Community Health” program.
 
ROC’s history of lobbying only raises further questions about its already questionable tactics and agenda. That’s why we’ve submitted a formal complaint to the IRS, requesting that they investigate ROC’s non-compliance with federal law.

Targeting groups for IRS scrutiny because they included the words “Tea Party” or “patriot” in their filings is clearly wrong, and the IRS must take action to see that its misconduct is not repeated. But where, as here, there is a demonstrated and extensive paper trial of a group doing one thing while telling the IRS the opposite, government action is warranted. In the meantime, consumers, the media, and the lawmakers who listen to ROC, should take this group’s claims with a grain of salt.
 

Paranzino is communications director for ROC Exposed, which is supported by a coalition of restaurant workers, employers and citizens concerned about ROC’s campaigns against America’s restaurants.

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