Governor Rick Snyder's million-dollar fund; why are donors a secret?

(WXYZ) - UPDATE: Following last night's 7 Action News Investigation, reporter Ross Jones was invited by the NERD Fund's board of directors to participate in their quarterly conference call, which took place this morning.

When asked to reconsider their decision not to disclose fund donors, board members said that they would not.  According to fund president Charlie Secchia, donors were told that their names and the size of their donations would be reported to the IRS, but not to the media or public. 

Secchia insisted that the fund, like Governor Snyder himself, is "squeaky clean," and helps to defray costs that would otherwise be paid by taxpayers.

Original report:

When he ran for Governor, Rick Snyder challenged voters to pick him over a slew of experienced politicians because he wasn't one.

"The nerd," as he called himself in political ads, won in a landslide.  But just over a month after taking office, he borrowed a page from some of those politicians, starting a fund that could take in and spend all the money it wanted it to, all in secret.

His New Energy to Reinvent and Diversify—or NERD Fund—is the same kind of non-profit that others have gotten in trouble over.

The feds say Kwame Kilpatrick pillaged his: using it for things like ritzy vacations, political polling and hiding bribes. 

Bob Ficano's fund paid his old deputy, Turkia Mullin, a secret $75,000 salary, courtesy of the businesses that wanted county contracts.  Non-profit experts like George Smith say these kinds of funds are easy to abuse.

"The money can come in, the money can be spent, and there's no one to ever say: what are you doing with it," Smith said.

That's because unlike campaign funds, where politicians have to disclose who gives and how much, these non-profits operate in the shadows.

Snyder's fund was founded to "lessen the burdens of government" and promote the state's "common good."

That includes buying a private security system for the Governor's Ann Arbor home, and some new furniture, too, costing more than $130,000.

But that's chump change when you see how just much the fund raised last year alone: more than $1.3 million. According to the fund's president, funds were also raised to pay for the Governor and his staff to travel around the country to promote the state, and to help fight a recall effort that Snyder thought he might face last year. All the money comes from secret donors.   

"You either have very strong convictions, or you want a favor," said Smith.

"You must be getting something for the money you're giving."

Snyder's office declined to supply 7 Action News with the names of donors to the fund, adding that no not-profit ever does.  But that's not true.

Oakland County Executive L. Brooks Patterson supplied a list of his non-profits donors within hours.  Wayne County Executive Bob Ficano's Wayne County Business Development Corporation used to keep its donor list private, but began releasing it last year after a 7 Action News investigation.

Snyder's decision to not release a list seems at odds with his public comments about making government more open.

"It's absolutely critical that we have accountability and transparency in financial information," Snyder said at an event earlier in his term.

"You might be the state's biggest proponent for transparency, but donors to your NERD fund are a secret. Why is that?" asked 7 Action News Investigator Ross Jones.

"We're complying with the law, this is just the normal practice," Gov. Snyder responded.

Snyder wouldn't agree to a sit-down interview.  Instead, his office told us to find him at a public appearance.  We did, and were allowed to ask only 2 questions.

"There's nothing that exciting about it.  We're just following the rules and moving ahead," Snyder said.

"If there's nothing exciting or controversial about it, why not release the donors," Jones asked.

"Well again, we've got so many different activities.  We're making sure we're complying with the law," Snyder responded, before being pulled away by an aide. 

Our interview lasted 32 seconds.

"People don't write 5, 6, 7 figure checks for selfless reasons," said campaign finance expert Rich Robinson.

"Most of these people don't want to be in the spotlight, they don't want transparency for what they're doing," he said.

And to non-profit experts like George Smith, all that secrecy raises one troubling question.

"They're trying to garner favors, and they don't want the general public to know it," he said.

"If you feel strongly about this fund, wouldn't you be proud to say you're giving this fund money? "

In addition to the Governor's security system and new furniture, Snyder's office also tells us that the fund paid for a new press auditorium at their Lansing offices and to sponsor an NAACP dinner. 

Late Tuesday, 7 Action News was invited to listen in on the fund's next quarterly conference call, taking place tomorrow.  The fund's president has also agreed to an interview after the holidays conclude this month.  

If you have a tip for the 7 Action News Investigators, contact us at tips@wxyz.com or at (248) 827-9466.

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