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  • Lyons sent Baptist money to Democrats

    By HOWARD TROXLER, Times Staff Writer
    ©St. Petersburg Times, published August 19, 1997

    Although federal law prohibits political contributions from religious organizations, the Rev. Henry J. Lyons last year wrote a $2,500 check from a National Baptist Convention USA Inc. account for a fund-raising dinner and reception with first lady Hillary Rodham Clinton.

    The contribution to the Democratic Party was drawn on the account of the Baptist Builder Fund and signed by Lyons, the convention's president, according to a Democratic official.

    The Internal Revenue Service says campaign contributions from tax-exempt groups, including religious organizations, "clearly violate the prohibition against political activity." Violations can result in revocation of tax-exempt status and an assessment of back taxes.

    Holger Euringer, a spokesman for the IRS' district office in Jacksonville, said he could not comment on whether the Baptist check violated the law because taxpayer records are confidential.

    Grady Irvin, an attorney for Lyons, said he would not comment on whether any specific checks were written from convention accounts.

    "The accounts of the National Baptist Convention will not be discussed publicly," Irvin said. "They are private matters. I can't confirm or deny whether this check, or any check, exists."

    Scott Falmlen, executive director of the Florida Democratic Party, said Monday he will look into the matter to determine whether to refund the contribution.

    The Baptist Builder Fund has been a focal point of controversy for Lyons. The fund, which Lyons maintains at United Bank and Trust Co. in St. Petersburg, is not listed in the organization's most recent annual report or audit. Half a dozen convention leaders said they did not know it existed until questions were raised about checks written from the account.

    Checks from the Baptist Builder Fund bearing Lyons' signature were used to help pay for a 5.56-carat diamond ring, water and sewer service for a $700,000 Tierra Verde house he owns with convicted embezzler Bernice Edwards and membership fees to a city club in Nashville.

    With the $2,500 check, Lyons bought admission to a reception for the first lady at the Renaissance Vinoy Resort in St. Petersburg on June 8, 1996, and a table for 10 at the state party's Jefferson-Jackson Dinner at the Coliseum that evening.

    Myrtle Smith-Carroll of St. Petersburg, a member of the Democratic National Committee and an organizer of the dinner, said in an interview that she called Lyons at his church, leaving messages inviting him to make a personal contribution.

    A few days before the dinner, she said, a secretary hand-delivered to her door the $2,500 check bearing Lyons' signature. Tables at the dinner cost between $1,000 and $5,000, depending on location. Lyons was assigned Table 79.

    Smith-Carroll kept a list of ticket-buyers on her computer. An assistant typed the information on the check into the data base: "Henry J. Lyons, c/o National Baptist Convention Baptist Builder Fund, 3455 26th Ave. S., St. Petersburg, 33711." The address matches that of Lyons' church in St. Petersburg, Bethel Metropolitan Baptist.

    Smith-Carroll said she did not question the legality of the contribution. "I had no idea that the Baptist Builder Fund was any different" than other groups with religious-sounding names that can legally make contributions, she said.

    Lyons attended the reception for Mrs. Clinton at the Vinoy. "He came down the hall, and I saw him going into the reception," she said. In fact, she stopped and introduced her daughter to him.

    After the dinner, Smith-Carroll said, she handed a state Democratic Party staffer the bundle of checks she collected for the event, including the check from the National Baptist Convention.

    Falmlen, the Democrat's executive director, said the party turned over the check to the Duval County Democratic Executive Committee. The state party sometimes gives contribution checks directly to its county organizations.

    The Duval party committee, in turn, reported receiving the $2,500 contribution on July 8, 1996, in its list of donors filed with the local Duval elections office, records show. The report named the contributor simply as "National Baptist Convention USA Inc."

    According to the IRS, a tax-exempt organization that makes a political contribution not only risks losing its exemption but also must retrieve the money and pay an excise tax of 10 percent. Any managers of the organization who approved the contribution must pay an additional tax of up to 2.5 percent of its amount.

    The IRS says ministers and other religious leaders are free to speak out on political matters, as long as they make it clear they are acting as individuals and not on behalf of their tax-exempt organizations.

    ©Copyright 2006 St. Petersburg Times. All rights reserved.