GOP Gift to Christian Group Irks Democrats : Politics: Traditional Values Coalition received $47,000 before November election. Money was used for information mailings.

State Democratic party officials are protesting a $47,000 Republican Party donation to the nonprofit Traditional Values Coalition in the final days of the hard-fought 1994 general election, saying the conservative group should lose its tax-exempt status.

The California Republican Party gave the Traditional Values Coalition $35,000 11 days before the November election and $12,000 more five days later.

The Anaheim-based Traditional Values Coalition used the money to mail voter information guides to more than 60,000 conservative Christians, said the Rev. Louis Sheldon, the group’s founder and president.

Bob Mulholland, a top California Democratic Party official, said the Democratic Party intends to complain to the Internal Revenue Service and perhaps to election officials, adding that “no nonprofit group should be a front for the Republican Party.”

“We have always seen Sheldon as a front for the Republican Party,” Mulholland said. “Taking [$47,000] is certainly evidence of that. He is very partisan.”

Sheldon, a Presbyterian minister, has been an influential player in the conservative religious movement for years. He said 1994 was the first year in which he took Republican money for his voter-education effort.

“If the Republicans are willing to pay to get this message out, we are happy to accept their donation,” Sheldon said, adding that his group did not violate tax or election laws. “They are servicing us, rather than us servicing them.”

He said the voter guide did not endorse candidates, which would have been a violation of his group’s tax-exempt status. Rather, the 16-page brochure described candidates’ views on abortion, gay rights, a balanced federal budget and tax-funded vouchers for private schooling.

Aided by religious conservatives, the GOP gained major victories in California in the last election, including control of the state Assembly and the state’s congressional delegation, as well as most state constitutional offices.

“They were delivering votes,” said John Peschong, executive director of the California Republican Party, explaining the reason for the donation. “They were making sure that people who support the Republican Party went to the polls--and they do a very good job.”

The Traditional Values Coalition is one of many nonprofit corporations set up to educate and benefit the public. Although donations to the coalition are not tax deductible, Sheldon’s group does reap benefits from its tax-exempt status by not having to pay state or federal taxes.

State and federal tax law allows the coalition to spend part of its time lobbying and on other political efforts. But laws restrict such groups from giving outright endorsements to candidates.

Although an IRS spokesman in Sacramento said he doubted Sheldon violated tax law, he noted that Congress has taken an interest in the question of the political activities of tax-exempt groups.

Greg Colvin, a San Francisco lawyer who co-chairs an American Bar Assn. committee on this area of tax law, said the donation falls into a “gray area of the law.”

“It’s a gray area of the law, but certainly the fact that the voter education activities attracted large donations from the Republican Party does raise a question as to whether those activities are nonpartisan,” said Colvin.

The Democratic Party also gives money to nonprofit groups, Mulholland said. But he drew a distinction, saying, “We have no nonprofit group that has for years been fronting for us. Sheldon consistently acts as a front for Republicans.”

“They’re very bigoted,” Sheldon said of the Democrats. “It’s just sour grapes that conservative Christians are aligning themselves with that party that best fits with their view.”

A similar group, evangelist Pat Robertson’s Christian Coalition, makes a practice of not soliciting Republican money since it took GOP money in its first year, 1989. Like the Traditional Values Coalition in California, the Christian Coalition was often accused of siding with the GOP on national issues.

“We have chosen to be nonpartisan and focus our message at the grass roots,” said Christian Coalition spokesman Mike Russell. “If you agree to accept money from either party, you are subject to be accused of partisan.”

The Christian Coalition’s tax status is unclear. It maintains that it has the same tax-exempt status as nonprofit groups such as the Traditional Values Coalition. But although the Christian Coalition has applied to the IRS for tax-exempt status, the IRS has not yet recognized it as such. Russell called the long-pending IRS decision a “formality.”

In its filings with the state attorney general’s division of charitable trust, the Traditional Values Coalition reported that it received $35,000 from the GOP last Oct. 28.

In separate filings with elections officials, the California Republican Party reported both the $35,000 donation and a second $12,000 donation on Nov. 2, days before the election on Nov. 8, 1994. It could not be determined why the Traditional Values Coalition did not report the $12,000 contribution.

The donations were the largest reported by the coalition in 1994. The next largest was a $10,000 contribution from the influential public relations company Burson-Marsteller. Sheldon said that donation funded a separate voter guide sent for the 1994 primary.

Sheldon is a regular figure in Sacramento and Washington, where he lobbies for conservative issues and is widely quoted on such issues as whether parents can spank their children, school performance testing, gambling, pornography and abortion.

Sheldon has gained his most attention for his opposition to gay rights. He denounces homosexuality as immoral, has suggested that people with AIDS be segregated in “cities of refuge,” and has battled to force the city of Santa Ana to withdraw a permit for a gay pride parade.