(Washington, D.C.) – Citizens Against Government Waste (CAGW) today released its latest investigative report, detailing taxpayer-funded grants to nonprofit organizations and their corrosive effect on these groups.  The report, entitled Phony Philanthropy: How Government Grants are Subverting the Missions of Nonprofits, focuses on grants from the Environmental Protection Agency to 839 organizations.  The report includes details of each group’s finances.

Nonprofit organizations and associations have a proud tradition in America of giving voice to the many citizens who choose to join such groups.  However, serious conflicts of interest can arise when the groups are funded in whole or in part by the government.  As one example of abuse, many of these organizations lobby Congress, and usually do so in a self-serving manner.

“This is a classic case of the left hand of government not knowing what the right hand is doing,” said CAGW president Tom Schatz.  “Groups that are taking money from one part of the government shouldn’t turn around and lobby another part of government on controversial issues.  The result of that process is that federal agencies are lobbying Congress by surrogate.  When a nonprofit group advocates a policy position, the American people should have confidence that it is not being influenced by their tax dollars.  This is an area crying out for greater oversight by Congress.”

In addition to a detailed analysis of the problems caused by these practices, the report also lists a number of organizations receiving grants from the EPA whose positions on controversial issues raise questions of propriety.  Some of these supposedly grassroots organizations receive up to 99 percent of their funding from the federal government, and several have negative fund balances.

“Federal funding is like a drug to these groups.  Once their dealer at the EPA has gotten them hooked on cash, they’ll take any position on any issue to get their fix in the next budget cycle,” concluded Schatz. 

CAGW is a 600,000-member nonpartisan, nonprofit organization dedicated to eliminating waste, fraud, mismanagement and abuse in government.