Flanked by top advisers, accountants and local businessmen, Rev. Jesse Jackson stepped forward Thursday in an effort to end mounting criticism about his organizations' finances, although even 90 minutes of explanation at a packed news conference left many questions unanswered.
Facing new challenges from conservative watchdog groups, Jackson distributed an internal financial report that for the first time listed the names of some corporate contributors.
Among them, tobacco giant Philip Morris gave $115,000 in 1999 to the Citizenship Education Fund, Jackson's economic development organization. Anheuser-Busch, the beer company Jackson once boycotted and for which his sons later obtained a lucrative distributorship, gave $10,000 in 1997, as did Doctors Hospital of Hyde Park. The hospital, owned by eye-care physician James Desnick, closed suddenly in April 2000 and facing $60 million in debt has since filed for bankruptcy.
Still, after attempting to clarify issues surrounding his financial documents connected to the four organizations he leads, neither Jackson nor his accountants could answer some lingering questions, including: Will the groups' 1998 and 1997 federal tax documents require amendments? Jackson's chief financial officer, who already has acknowledged that 1999 documents will be revised and resubmitted, said his study of the organization's finances over the past three years will not be finished until next week.
With supporters at Rainbow/PUSH Coalition headquarters nodding in agreement, Jackson said the group's finances had been handled with "discipline, dignity, integrity and results and legal propriety."
Jackson defended his organization's work on KidCare, a federally financed health-care program for the state's poorest children. Rainbow/PUSH received a one-year, $763,000 contract for the program. He had criticized Gov. George Ryan for not enrolling enough children, then appeared to ease off of that criticism after his organization was awarded the no-bid contract.
The state approached Rainbow/PUSH in an effort to raise public awareness about the program because many people didn't know it existed or had misconceptions about it, said Rainbow/PUSH general counsel Janice Mathis.
The funding has been used primarily on personnel for a three-person staff and for travel, she said. The state contract with Rainbow/PUSH calls for "no fewer than five staff as KidCare specialists." A Jackson spokeswoman could not be reached Thursday night for explanation.
In the last two years, 147,000 were added onto KidCare rolls out of a potential pool of 190,000 identified in a University of Illinois study before the project began. During the time Rainbow/PUSH has had the contract, 37,000 were added in about seven months, according to State of Illinois spokesman Eric Robinson.
"You cannot measure Rainbow/PUSH's effect on KidCare enrollment simply by counting the number of people we report to (the state) that we've personally met," Mathis said. "That number does not include people who've heard our radio broadcast, heard (Jackson's) public service announcements or who see the television broadcast."
Jackson also used the occasion to illustrate some of the work he does with the Citizenship Education Fund on behalf of minority entrepreneurs, attempting to open doors to coffers in corporate America that previously had been closed. Jackson often challenges corporations about their hiring practices and the diversity of their boards of directors, particularly when such companies are seeking federal approval for a merger.
In turn, many of these corporations have either placed African-Americans and Latinos on their boards, or hired or done business with them in other ways. Some have given contributions to his organizations, leading to criticism of Jackson.
Jackson, along with several local black businessmen in attendance, including investment banker John Rogers, advertising executive Tom Burrell and media executive Don Jackson (no relation), said the charge that Jackson only helps his friends gain access is not true.
"In our relationship with him, there has never been a hint, suggestion or demand for a quid pro quo," said Jim Reynolds, CEO of Loop Capital Markets, an investment firm. "Our conversations always revolve around one thing: 'Jim, what can I do for you? How can I help you?'"
Don Jackson, owner of Central City Productions, said his company also had been helped by Jackson keeping pressure on major corporations to do business with African-Americans. Central City Productions is responsible for minority-themed television programming such as "Know Your Heritage" and gospel's Stellar Awards.
"When he puts pressure on businesses like Coca-Cola, they respond by reaching out to do business with me," Don Jackson said. "When he references his efforts in this area, I'm a beneficiary of that. If he doesn't continue, the doors that are open are going to close again."
Many of the financial questions have involved the Citizenship Education Fund, one of the four organizations linked to Jackson. Chief financial officer Billy Owens said he will amend the 1999 federal disclosures for the fund. Among problems found on the earlier filings: Five people are missing from a list of top paid employees and two people are missing from a list of "key employees," Owens said in an interview Thursday.
Accountants wrote "none" in the list of top paid employees, although at least five people earned more than $50,000 that year, including a Chicago employee who made $85,000 and a Los Angeles employee who collected $70,000.
Although she, too, is not listed on the 1999 disclosure, Karin Stanford, the former employee with whom Jackson had a child in 1999, also collected more than $106,000 that year from groups associated with Jackson, Owens said on Thursday.
Since the revelation about Stanford's child emerged in January -- setting off much of the scrutiny of Jackson's finances -- Jackson's representatives have offered differing amounts and explanations of payments to her. The missing names -- including Stanford's -- were nothing more than oversights, Rainbow/PUSH officials said.
The latest account, on Thursday, of payments to Stanford included another new wrinkle. Of the $106,480 total, Stanford received some $67,000 for her work at Citizenship Education Fund, $9,231 from Rainbow/PUSH Coalition, and another $30,000 from a labor union that has worked with Rainbow/PUSH, Owens said. It remained unclear, though, what services Stanford provided for the union or for Rainbow/PUSH Coalition.
A second conservative organization this week called for further financial investigations into Jackson's groups.
The American Conservative Union is calling for an IRS audit of Jackson's tax-exempt organizations, as well as a Federal Election Commission examination of travel Jackson took last year as part of the presidential campaign year.
But Rainbow/PUSH officials say Jackson's travel, though paid for by Democrats, was "non-partisan." Jackson's message, Owens said, was not on behalf of a candidate, but aimed at getting people registered to vote and out to the polls.
Tribune staff writer E.A. Torriero contributed to this report.Copyright © 2014, Los Angeles Times