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California YIMBY logo. (Photo: cayimby.org)

FPPC Probing Weinstein’s AIDS Health Foundation for Campaign Finance Violations

Fight between affordable housing advocates and rent control initiative

By Katy Grimes, July 17, 2020 3:53 pm

The California Fair Political Practices Commission, the state’s campaign finance watchdog is moving forward with an investigation of drug company executive Michael Weinstein’s AIDS Health Foundation on a complaint by California YIMBY for allegedly failing to report tens of thousands of dollars of campaign spending. AHF is the funder of Proposition 21, a rent control measure on the November 3rd ballot, opposed by affordable housing, veterans, labor and taxpayer groups. The title of Prop. 21 is, “Expands Local Governments’ Authority To Enact Rent Control On Residential Property.”

The initiative is a revised version of Proposition 10, Weinstein’s 2018 rent control initiative to repeal the Costa-Hawkins Rental Housing Act. Prop. 10 failed to pass, 59% to 40% at the polls, despite $25 million in campaign spending by Weinstein’s AIDS Healthcare Foundation. “Supporters raised $25.30 million, with 89 percent of funds received from the AIDS Healthcare Foundation,” Ballotpedia reported. “Five ballot measure committee registered in opposition to Proposition 10—Californians for Responsible HousingCalifornians For Affordable HousingNo On Prop 10Issues PAC of Apartment Association of Greater Los Angeles, and Santa Barbara Housing Providers Against Proposition 10. Together, the committees raised $71.37 million. The committees spent $72.11 million,” according to Ballotpedia.

California YIMBY, which stands for “Yes In My Back Yard,” says “yes affordable housing, yes to inclusive, equitable communities, yes to opportunity, and yes to more neighbors!”

 

FPPC letter confirming investigation of AHF. (Photo: screen capture of FPPC letter)

 

The FPPC confirmed it is investigating the AIDS Health Foundation for violating multiple state campaign finance laws to oppose Senate Bill 50, a controversial housing bill defeated in the Legislature earlier this year. In the complaint, California YIMBY alleges that AIDS Healthcare Foundation failed to report its spending for radio and social media advertisements, direct mail pieces, a website, and other activities attacking the legislation. Included are controversial and inaccurate mailers from Weinstein’s group that were assailed by the San Francisco chapter of the NAACP, and other organizations as racist and offensive.

“AHF is aware of the requirements of California’s Political Reform Act and nonetheless disregarded the plain fact these expenses are clearly reportable under California law,” the complaint alleges.

According to California YIMBY, “In recent years, AIDS Healthcare Foundation has established itself through its political disinformation campaigns, running an array of “dirty tricks” campaigns that deploy aggressive lobbying tactics, and undisclosed political spending to advance its secretive agenda. With an annual budget of $1.5 billion, Weinstein’s organization has grown into a powerful political and lobbying group for Weinstein’s pet causes with ample resources to ensure compliance with the law.”

“Weinstein’s violations of the lobby disclosure provisions of the Political Reform Act appear to be an intentional attempt to deny the public vital information regarding the organization’s lobbying expenditures,” California YIMBY’s CEO Brian Hanlon said in a statement in February. “While we’re confident this is a violation of state law, we’re also disturbed by the fact that it goes against the spirit of charitable organizations, a cornerstone of American civil society. Rather than devote resources in accordance with their healthcare mission, the AIDS Healthcare Foundation chose to spend hundreds of thousands of dollars dishonestly attacking both SB 50 and state Senator Scott Wiener for authoring legislation to make California more affordable and inclusive. While it is Michael Weinstein’s right to oppose affordable home building, it is not his right to violate political finance law, and to spend charitable dollars for political purposes, possibly in violation of tax law.”

In February, California Attorney General Xavier Becerra said the AIDS Health Foundation was “delinquent” in its nonprofit status after the group failed to file documents required to meet the requirements to claim charitable standing in the state.

Last August, Senator Ben Hueso (D-San Diego) also called on the Attorney General to investigate the AIDS Health Care Foundation, charging that the group was fraudulently misusing savings from a federal drug-discount program designed to help low-income patients.

The FPPC fined the AIDS Healthcare Foundation’s committee in 2018 for its failure to disclose political campaign spending on Measure S, a housing ballot measure in Los Angeles.

“Advocacy at AHF has been pushing the boundaries in the name of basic human rights for over thirty years,” AHF says on its website. “It’s as fundamental to our organization as the care we give our patients.” AHF has advocated for reducing drug prices, and has sued numerous pharmaceutical companies over “exorbitant drug prices and antitrust and patent violations.” 

You can read California YIMBY’s complaint here.

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2 thoughts on “FPPC Probing Weinstein’s AIDS Health Foundation for Campaign Finance Violations

  1. It sounds like the AIDS Health Foundation is another 501(c)(3) organization that has abused its tax-exempt status?

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