Charitable Gifts From Wealthy Koch Brothers Often Prompt Partisan Reactions

Charitable Gifts From Wealthy Koch Brothers Often Prompt Partisan Reactions

Industrialists Are Among Nation's Most Visible Supporters of Conservative Political Causes

By

Melanie Grayce West

connect

Aug. 3, 2014 9:50 p.m. ET

Rarely has so much well-intentioned money spurred so much controversy.

One $100 million gift, targeted to help build a new hospital facility, was later the focus of street protests. A $25 million donation funding scholarships for minority students prompted one Ivy League professor to urge the rejection of the "tainted" gift. And a $1 million grant to fund a business-school study provoked 50 prominent Catholic educators to decry the "stark contrast" between the giver's ideology and the church's traditional teachings.

In each case, the philanthropist behind the controversy was a brother named Koch.

Wealthy industrialists Charles Koch, 78 years old, and his brother, 74-year-old David, are among the nation's most visible supporters of conservative political causes—a fact that, in many cases, has made their nonpolitical giving a lightning rod for partisan reaction.

Graphic: Stirring Up Controversy

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Critics say their extensive donations to higher education and health care, among other causes, are tainted by tea party-friendly politics, and rife with hidden strings and agendas. Conservatives call such reactions nonsensical, a product of knee-jerk liberal intolerance.

All of which raises the question: Should nonprofit groups—especially those in a largely liberal city like New York—be concerned with a donor's political leanings?

Melissa Cohlmia, a spokeswoman for the Koch companies, doesn't think so, saying "it is unfortunate that some people and organizations put their political agendas ahead of helping people, especially those that are sick and disadvantaged."

The question is typically a matter for a receiving institution's board of directors to decide, said Naomi Levine, a veteran fundraiser and executive director of New York University's George H. Heyman, Jr. Center for Philanthropy and Fundraising.

"When there's an ethical issue, you have to have a process in place," she said.

Ms. Levine said some schools and charities, but not many, have rules for accepting gifts. These policies—often interpreted by the board's executive committee—usually focus on the legality of how a donor's money is earned and whether the giver has publicly made racist or anti-Semitic remarks.

Political leanings, on the other hand, usually don't raise a red flag, she said.

In this composite image, David Koch speaks in Orlando, Fla in this August 2013 file photo, left, and Charles Koch speaks during an interview in May 2012 in his office at Koch Industries in Wichita, Kansas, right. 

"I don't know the politics of many of our donors," said Ms. Levine, who raised funds for New York University. "I suspect many of them have politics that I would be unhappy with. But that's irrelevant. If the money comes to us made legally and allows us to do with it what the university needs, we will accept it."

Despite vocal opposition to Koch donations by outside observers and occasional stakeholders, institutions continue to accept the brothers' money.

Of recently disputed gifts, both the $1 million donation made last year to the Catholic University of America and the $25 million grant made in June to the United Negro College Fund were accepted—which leaders of each institution publicly defended.

Michael Lomax, president and chief executive of the United Negro College Fund, said through his spokesman that criticism for accepting the Koch gift was a small price to pay to help children realize their dreams of a college education.

Dr. Lomax and his spokesman declined to comment on any gift-acceptance policy at the UNCF, saying only that they have never used a political or ideological lens to determine who can or can't give support.

In their respective hometowns—Charles lives in Wichita, Kan., and David is a longtime New Yorker—the brothers are known for their largess. The Koch name dots many cultural and civic institutions in Wichita, home of Koch Industries Inc., a privately held global conglomerate with businesses ranging from fuels and fertilizer to cattle and electronics parts. The Charles Koch Foundation, based in Wichita, gives widely to U.S. colleges.

And while the brothers are often lumped together in the public consciousness, their philanthropy is substantially different. For his part, David is known for multimillion-dollar gifts to his alma mater, the Massachusetts Institute of Technology, and to many of New York's biggest cultural gems and medical institutions, including the Metropolitan Museum of Art, American Ballet Theatre and Memorial Sloan-Kettering Cancer Center.

Many organizations that have received such hefty donations from David Koch declined to respond to The Wall Street Journal about whether their governing boards have gift-acceptance policies. A spokeswoman for the American Museum of Natural History said the organization had no such policy.

Mr. Koch serves on most of the boards of nonprofits he donates to. As with any volunteer governing body, members are generally expected to give an annual gift.

Still, David Koch's $100 million gift last year to NewYork-Presbyterian Hospital to help build an outpatient center was a featured grievance in at least two subsequent union protests. Signs and banners at a March rally read, "Quality Care, Not Koch Care."

Mr. Koch serves on the hospital's executive, real-estate and major-facilities committees.

While leaders from the health-care workers' union 1199 SEIU and the New York State Nurses Association said the rallies' main goal was to call attention to working conditions at the hospital and its increasing culture of corporatization, they said the events also were a chance to voice disapproval of Mr. Koch. His funding of groups opposed to the Affordable Care Act and Medicaid expansion, they said, runs counter to the hospital's mission of making health care accessible for all.

Through a spokeswoman, David Koch said, "The new ambulatory care center will treat people from all walks of life and will result in hiring more nurses too."

A hospital spokeswoman declined to comment on the protests or on whether it had a gift-acceptance policy, but expressed gratitude for Mr. Koch's donation and longtime board contributions. Steven J. Corwin, the hospital's chief executive, said Mr. Koch's service on the executive committee is "helping us to become one of the top hospitals in the country."

Sometimes just the prospect of a Koch gift can spark controversy.

In June, Mitchell Langbert, an associate professor of business at Brooklyn College, went public with grievances he had with school administrators, who he said squandered a chance to obtain millions of dollars from the Charles Koch Foundation.

Mr. Langbert said he has a contact at the foundation and had received signals of its openness to receiving his proposal for a new center at the business school, which he believed would expand and upgrade the department's faculty. He previously had been awarded $5,000 from the foundation, he said, "to write a report."

The college acknowledged Mr. Langbert's previous grant from the Charles Koch Foundation but said it had neither "received an offer from, nor submitted a proposal to" the foundation for a multi-million-dollar grant.

The foundation doesn't comment on its gifts, a spokeswoman said.

Mr. Langbert said that, in his opinion, the school ultimately withheld its institutional blessing because administrators were "afraid of a little conflict" that pursuing or receiving such Koch-labeled money might engender.