ID: 4721564
Publication Date: September 18, 2010
Day: Saturday
Page: A1
Edition: FIRST
Section: News
Type: National State Local
Dateline:
Column:
Length: long
The filing details how the directors used the foundation's tax-free money
at the same time it was publicizing its nonprofit redevelopment work in
Easton, sought a federal taxpayer earmark from U.S. Rep. Charlie Dent
and accepted hundreds of thousands of dollars in public support.
The tax filing also states that $71,504 was paid to an individual helping
the household of Jane Kheel Stanley, foundation director and secretary,
after that person ceased offering services to Nurture Nature. It also lists
$761 of purchases inadvertently made on behalf of Martha Kheel.
Asked about the tax filings, Stanley said there were "unquestionably
mistakes" and that the foundation internally investigated the payments,
changed accounting firms and self-reported the problem to the Internal
Revenue Service as part of its annual 990 filing required for all nonprofit
organizations.
Stanley said the amounts attributed to her and Martha Kheel occurred
without their knowledge. She declined to elaborate on who initiated the
internal investigation, which began in early 2009, or why it took so many
years to uncover the payments.
Stanley said the IRS has not yet told the foundation if it will be liable for
$481,536 in penalties.
Mark William Hanson, spokesman for the IRS, said the agency does not
comment on specific taxpayers or their taxes based on federal disclosure
regulations and federal law. The foundation submitted its 2008 tax return
Nov. 23, 2009, detailing the problems, and submitted an addendum in
March of this year.
Stanley said the 2009 tax filing will include additional improper payments
made that year before the foundation's investigation was complete. She
did not detail those payments.
Theodore Kheel no longer serves on the board because of his age, Stanley
said, and Hoffman resigned as executive director "a few months ago."
Reached by telephone for comment on the payments, Hoffman said she
was not "a good spokesperson for this situation."
"If there was anything that happened, it was clearly a mistake and it's all
been corrected," Hoffman said. Asked why she accepted $584,541 in
payments from the foundation for personal expenses, she again said it was
a mistake.
Tax filings for Nurture Nature from 2004 to 2007 show Hoffman worked
an average of 20 hours per week and earned a total of $385,800, or an
average $96,450 per year. The foundation's 2008 filing lists Hoffman as
unpaid.
Stanley said the foundation did not make Dent aware of the internal
problems when it asked for the earmark because they had not yet been
uncovered. She said the foundation received the federal money after
directors instituted reforms, and that the money was held in Easton, not in
New York.
The foundation last year received a $75,000 planning grant from the
National Science Foundation to host forums focused on the science of
flooding and mitigation strategies for people living the Lehigh Valley.
The 2008 tax filing states the foundation also received about $866,000 in
public support in that year.
The grant money was not part of the improper payments, Stanley said.
She called the foundation's problems an "aberration" and said the current
board has implemented a new, rigorous accounting procedure to make
sure the mistakes never happen again. She added that she feared these
mistakes would overshadow her father's millions of dollars invested in
Easton.
Theodore Kheel was born in New York and became a renowned expert in
labor mediation. He built his reputation working for the National Labor
Relations Board and the National War Labor Board and in arbitration
during the 1940s and 50s.
Kheel's career peaked as New York City's chief labor negotiator between
1949 and 1982, when he helped mediate a New York City newspaper
strike and, at the request of President John F. Kennedy, a longshoremen
dispute, among 30,000 other decisions he rendered.
Kheel also was active in civil rights issues, serving as president of the
National Urban League.
Kheel and Peter Koehler's relationship began about 1980 when Kheel
invested in a midtown Manhattan restaurant where Koehler worked as a
chef. Their business relationship, as well as their friendship, soon
blossomed. Koehler previously told The Morning Call he considered
Kheel his mentor.
Nurture Nature's Easton holdings now include the Eastonian, the former
Veterans of Foreign Wars building at 518 Northampton St., the former
Salvation Army building at 214 Spring Garden St. and a home at 914
Spruce St. The foundation in 2008 reported $33 million in net assets.
Stanley said Kheel invested much of his own money into the foundation.
Easton Mayor Sal Panto Jr. did not return a message seeking comment.
christopher.baxter@mcall.com
610-778-2283