Big drug companies gave $172,400 to the Utah Families Foundation in 2007. Critics say they doubt those firms did that out of concern for Utah families, but instead gave the big money to reward their longtime political ally Sen. Orrin Hatch — who helped create the group and helps raise funds for it.
Critics say it is an example of how special interests can make an end run around campaign donation limits and reward friends by giving to private foundations that they like. Hatch says he did no favors in return for the donations that drug companies made to the foundation.
But Hatch again is being attacked for his close financial ties to the pharmacy industry that he has often helped legislatively. Previously, he was attacked for such things as flying on a jet owned by drugmaker Schering-Plough during his short-lived presidential campaign in 2000, after which he pushed a bill to extend that company's patent on the drug Claritin.
The Washington Times this week reported the latest twist. The IRS mistakenly released a tax form from the Utah Families Foundation to Guidestar.org, which maintains an online database about nonprofit foundations. Foundations need not list their donors publicly, but the accidental release identified donors to the Utah group.
Among donations made by drug companies were $40,000 by PhRMA (a lobbying arm of the pharmaceutical industry); $30,000 by Barr Pharmaceuticals; $27,500 by Sepracor; and $25,000 each from Eli Lilly, Becton Dickinson and AstraZeneca.
The Times noted that at the same time those big donations came, Hatch's son, Scott, became a partner at the lobbying firm used by PhRMA — so it was giving big money to a charity pushed by Hatch, while also using his son as a lobbyist. (The younger Hatch has said he does not lobby the senator Hatch or his office.)
Melanie Sloan, who heads Citizens for Responsibility and Ethics, told the Times, "When companies need a member of Congress and they've already donated to their campaigns, they can make very large contributions to members' foundations. It's another way to curry favor with a member of Congress."
The Times quoted leaders of the drug companies saying they gave to the Utah charity, and have for years, because of Hatch. Ken Johnson, senior vice president at PhRMA, said any cause backed by Hatch "automatically carries the gold seal of approval."
The Utah Families Foundation, according to its IRS filings, seeks to help needy Utah families who face homelessness, poverty, hunger, unemployment, illness or illiteracy. It raised $1.1 million in 2007, and gave about $726,000 to groups ranging from the Road Home shelter to Primary Childrens Medical Center, the Utah Food Bank and Special Olympics.
But it gave some money to groups that may not seem to hit the group's declared target of helping the needy, including the Utah Symphony & Opera and the Springville Museum of Art.
The foundation's president, according to 2007 forms, is Carol Nixon, a longtime friend of Hatch. Others on its board include Hatch's campaign manager, Dave Hansen, and Frank Madsen, a former top aide to Hatch. Others include former Gov. Olene Walker and former U.S. Sen. Jake Garn.
Hatch told the Deseret News in response to the new criticism, "Everyone who knows me can attest that I simply do what I believe is right for our state and nation, regardless of who supports me. If a company or organization decides to support the Utah Families Foundation and its wonderful mission of helping so many in need, that's great.
"The only benefit I receive is the knowledge that even more people will be helped," Hatch said.
Hatch added that he serves as an honorary host of the foundation's annual fundraising event. "They help a lot of people and for that I'm grateful," he said.
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