STATEMENT OF THE INVESTIGATIVE SUBCOMMITTEE ON BEHALF OF THE HOUSE COMMITTEE ON STANDARDS OF OFFICIAL CONDUCT
December 21, 1996

The House Committee on Standards of Official Conduct is today releasing a Statement of Alleged Violation issued in the matter of Representative Newt Gingrich. In addition, the Committee is also releasing Mr. Gingrich's answer to the Statement of Alleged Violation, in which he admits to the violation of House Rules contained in the Statement of Alleged Violation.

In light of Mr. Gingrich's answer, the Investigative Subcommittee is of the view that the Rules of the Committee will not require the holding of an adjudicatory hearing to determine whether the violation has been proven. Accordingly, with the concurrence of the Committee, the next proceeding will be a hearing before the full Committee to determine a recommendation to the House for an appropriate resolution. Since this remains a pending matter, there will be no further public comment.

U.S. HOUSE OF REPRESENTATIVES COMMITTEE ON STANDARDS OF OFFICIAL CONDUCT IN THE MATTER OF REPRESENTATIVE NEWT GINGRICH

RESPONDENT'S ANSWER TO STATEMENT OF ALLEGED VIOLATION

I, Newt Gingrich, admit to the Statement of Alleged Violation dated December 21, 1996.

U.S. HOUSE OF REPRESENTATIVES COMMITTEE ON STANDARDS OF OETICIAL CONDUCT IN THE MATTER OF REPRESENTATIVE NEWT GINGRICH
December 21, 1996

STATEMENT OF ALLEGED VIOLATION

1. At all times relevant to this Statement of Alleged Violation, Newt Gingrich was a Member of the United States House of Representatives representing the Sixth District of Georgia.

2. At all times relevant to this Statement of Alleged Violation, GOPAC was a political action committee within the meaning of section 527 of the Internal Revenue Code dedicated to, among other things, achieving Republican control of the United States House of Representatives.

3. GOPAC's methods for accomplishing the goal described in paragraph 2 included the development of a political message to appeal to voters and the dissemination of that message as widely as possible. As stated in a draft document dated November 1, 1989, entitled "GOPAC IN THE 1990s:"

[GOPAC's] role is to both create and disseminate the doctrine of a majority Republican party.

The creation of a new doctrine is essentially a research function, involving the development of new ideas at the strategic, operational and tactical level. Strategic doctrine, in this context, consists of the language, policies and programs that will define the caring, humanitarian, reform Republican agenda of the 1990s. Operational doctrine consists of the political message and image which will attract voters and elect state and local candidates in support of this new agenda. And, tactical doctrine consists of the specific political techniques Republicans will use to win elections and enact governing conservative policies. (emphasis in the original).

The document then states:

As important as the creation of the new doctrine is its dissemination. During the 1980s GOPAC and Newt Gingrich have led the way in applying new technology, from C-SPAN to video tapes, to disseminate information to Republican candidates and political activists.

* * *

But the Mission Statement demands that we do much more. To create the level of change needed to become a majority, the new Republican doctrine must be communicated to a broader audience, with greater frequency, in a more usable form. GOPAC needs a bigger "microphone." (emphasis in the original).

4. From in or about September 1986 through in or about May 1995, Mr. Gingrich was General Chairman of GOPAC. In that capacity he determined the messages GOPAC used to accomplish its goals.

5. In a document entitled "Key Factors in a House GOP Majority, " Mr. Gingrich wrote the following:

1. The fact that 50% of all potential voters are currently outside politics (non-voters) creates the possibility that a new appeal might alter the current balance of political power by bringing in a vast number of new voters.

* * *

3. It is possible to articulate a vision of "an America that can be" which is appealing to most Americans, reflects the broad values of a governing conservatism (basic American values, entrepreneurial Free Enterprise and Technological progress), and is very difficult for the Democrats to co-opt because of their ideology and their interest groups.

4. It is more powerful and more effective to develop a reform movement parallel to the official Republican Party because:

a. the news media will find it more interesting and cover it more often and more favorably;

b. the non-voters who are non-political or anti political will accept a movement more rapidly than they will accept an established party;

6. The objective measurable goal is the maximum growth of news coverage of our vision and ideas, the maximum recruitment of new candidates, voters and resources, and the maximum electoral success in winning seats from the most local office to the White House and then using those victories to implement the values of a governing conservatism and to create the best America that can be.

6. In early 1990 GOPAC developed and carried out a project called American Opportunities Workshop ("AOW"). It consisted of producing and broadcasting a television program centered on a citizens' movement to reform government. The movement was based on three tenants:

  1. Basic American Values;
  2. Entrepreneurial Free Enterprise; and
  3. Technological Progress.

The project also involved the recruitment of activists to set up local workshops around the broadcast in order to recruit people to the movement. The project was Mr. Gingrich's idea and he had a high level of involvement in it.

7. While AOW was described as being non-partisan, mailings sent by GOPAC to its supporters described AOW as having partisan, political goals. One letter sent over Mr. Gingrich's name stated the following:

[W]e'll be reaching voters with our message, and helping drive down to the state and local level our politics of realignment.

Through the use of satellite hook-ups, not only can we reach new groups of voters not traditionally associated with our Party, but we'll be able to give them our message straight, without it being filtered and misinterpreted by liberal elements in the media.

The letter ended with the following:

I truly believe that our Party and our President stand on the verge of a tremendous success this year, and that this workshop can be a great election year boost to us.

8. AOW consumed a large portion of GOPAC's financial resources during 1990. After one program the funding and operation of the project was transferred, with Mr. Gingrich's knowledge and approval, to the Abraham Lincoln Opportunity Foundation ("ALOF"), a corporation with a tax-exempt status under section 501(c)(3) of the Internal Revenue Code. ALOF operated out of GOPAC's offices. Its officers consisted of Howard Callaway, the Chairman of GOPAC, and Kay Riddle, Executive Director of GOPAC. In addition, the people who were listed as working for ALOF were GOPAC employees or consultants. ALOF raised and expended tax-deductible charitable contributions to carry out the project.

9. At ALOF the project was called American Citizens' Television ("ACTV") and had the same goals as AOW. It was also based on the three tenants of Basic American Values, Entrepreneurial Free Enterprise, and Technological Progress and involved the recruiting of activists to set up local workshops around the broadcast to recruit people to the citizens movement. In a letter sent by GOPAC over Mr. Gingrich's name, ACTV was described as follows:

I am excited about progress of the "American Citizen's Television" project, which will carry the torch of citizen activism begun by our American Opportunities Workshop on May l9th. We mobilized thousands of people across the nation at the grass roots level who as a result of AOW, are now dedicated GOPAC activists. We are making great strides in continuing to recruit activists all across America to become involved with the Republican party. Our efforts are literally snowballing into the activist movement we need to win in '92.

10. ACTV broadcast three programs in 1990 and Mr. Gingrich continued his involvement in the project. The first two were produced by ALOF. They aired on July 21, 1990, and September 29, 1990, and were hosted by Mr. Gingrich. The last program was produced by the Council for Citizens Against Government Waste, a 501(c)(4) organization, and did not include Mr. Gingrich. ALOF expended approximately $260,000 in regard to these programs.

11. Under the Internal Revenue Code, an organization which is exempt from taxation under section 501(c)(3) must be operated exclusively for exempt purposes. The presence of a single non-exempt purpose, if more than insubstantial in nature, will destroy the exemption regardless of the number or importance of truly exempt purposes. Conferring a benefit on private interests is a non-exempt purpose. Under the Internal Revenue Code, an organization which is exempt from taxation under section 501(c)(3) is also prohibited from providing any support to a political action committee. These prohibitions reflect Congressional concerns that tax-payer funds not be used to subsidize political activity.

12. Mr. Gingrich did not seek specific legal advice concerning the application of section 501(c)(3) of the Internal Revenue Code in regard to the facts described in paragraphs 2 through 10 and did not take affirmative steps to ensure that such legal advice was obtained by others from an appropriate source.

13. During the Preliminary Inquiry the Investigative Subcommittee ("Subcommittee") consulted with an expert in the law of tax-exempt organizations. Mr. Gingrich's activities on behalf of ALOF and the activities of others on behalf of ALOF with Mr. Gingrich's knowledge and approval were reviewed by the expert. The expert concluded that those activities violated ALOF's status under section 501(c)(3) of the Internal Revenue Code in that, among other things, those activities:
a. were intended to confer more than insubstantial benefits on GOPAC and Republican entities and candidates; and
b. provided support to GOPAC.

14. The Subcommittee also heard from tax counsel retained by Mr. Gingrich for the purposes of this Preliminary Inquiry. According to Mr. Gingrich's tax counsel, this type of activity would not violate ALOF's status under section 501(c)(3) of the Internal Revenue Code.

15. Both the Subcommittee's expert and Mr. Gingrich's tax counsel agree that had they been consulted about this type of activity prior to its taking place, they would have advised that it not be conducted under the auspices of an organization exempt from taxation under sectionT01(c)(3) of the Internal Revenue Code.

16. If the legal advice described in paragraph 15 had been sought and followed, most, if not all, of the tax-deductible charitable contributions would not have been used for the activities described in paragraphs 2 through 10. As a result, the public controversy involving the legality of a Member's involvement with an organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code concerning activities described in paragraphs 2 through 10 would not have occurred.

17. In December 1992, Mr. Gingrich began to develop a movement which became known as Renewing American Civilization. The goal of this movement was the replacement of the "welfare state" with an "opportunity society."

18. A primary means of achieving this goal was the development of the movement's message and the dissemination of that message as widely as possible. The message was also known by the name of Renewing American Civilization. The heart of that message was that the welfare state had failed, that it could not be repaired but had to be replaced, and that it had to be replaced with an opportunity society that was based on what was called the "five pillars of American Civilization." These were: 1) personal strength; 2) entrepreneurial free enterprise; 3) the spirit of invention; 4) quality as defined by Edwards Deming; and 5) the lessons of American history. The message also concentrated on three substantive areas. These were: 1) jobs and economic growth; 2) health; and 3) saving the inner city.

19. It was intended that a Republican majority would be part of the movement.

20. One aspect of the movement was to "professionalize" the House Republicans. One method for doing this was to use the movement's message to attract voters, resources, and candidates.

21. GOPAC was one of the institutions that was instrumental in developing and disseminating the message of the movement. In early 1993 Mr. Gingrich, as GOPAC's General Chairman, was instrumental in determining that virtually the entire political program for GOPAC in 1993 and 1994 would be centered on developing, disseminating, and using the message of Renewing American Civilization.

22. In late 1992 and through 1993, GOPAC's limited financial resources were not sufficient to enable it to carry out all of the political programs at its usual level.

23. In or about late 1992 or early 1993, Mr. Gingrich decided to teach a course. It was also entitled Renewing American Civilization. The course lasted ten weeks and devoted a separate session to each of the "five pillars" and each of the three substantive areas.

24. GOPAC had a number of roles in regard to the course. They included:

a. Starting in or about February 1993, employees and consultants for GOPAC were involved in developing the course. As of June 1, 1993, Jeffrey Eisenach, GOPAC's Executive Director, and two of his assistants, resigned from their positions at GOPAC to manage the operations of the course. They did, however, maintain a consulting contract under which GOPAC paid one-half of their salaries through September 30, 1993.
b. In a letter sent to all GOPAC Charter Members over Mr. Gingrich's name in June 1993, another aspect of GOPAC's involvement in the course was described as follows:

During our meeting in January, a number of Charter Members were kind enough to take part in a planning session on "Renewing American Civilization." That session not only affected the substance of what the message was to be, buf also how best the new message of positive solutions could be disseminated to this nation's decision makers-- elected officials, civic and business leaders, the media and individual voters. In addition to my present avenues of communications I decided to add an avenue close to my heart, that being teaching. I have agreed with Kennesaw State College, a 12,000 student graduate and undergraduate college located in my district, to teach "Renewing American Civilization" as a for-credit class four times during the next four years.

c. GOPAC's Charter Member Meeting in April 1993 was entitled "Renewing American Civilization." At that meeting, Charter Members were asked to help develop the ideas contained in the course. A memorandum to the Charter Member attendees described that process as follows:

As you are probably aware, Newt will be teaching a for-credit class at Kennesaw State College this Fall on the topic of "Renewing American Civilization. n The class is organized around his "Five Pillars of American Civilization"

During the afternoon of Sunday, April 25, we are asking our Charter Members to participate in a set of breakout sessions, with one session focussing on each of the five "pillars. In particular, we will ask you to critique a draft "visions statement" explaining why we believe each pillar is essential to renewing American Civilization. If past experience is any guide, we expect these sessions to dramatically improve both our understanding of the subject and our ability to communicate it.

d. GOPAC employees took part in fundraising for the course.

e. GOPAC was involved in the promotion of the course. In one such instance, GOPAC prepared and sent a letter concerning the course over Mr. Gingrich's name to College Republicans. The letter included the following:

[C]onservatives today face a challenge larger than stopping President Clinton. We must ask ourselves what the future would be like if we were allowed to define it, and learn to explain that future to the American people in a way that captures first their imagination and then their votes.

In that context, I am going to devote much of the next four years, starting this Fall, to teaching a course entitled "Renewing American Civilization." I am writing to you today to ask you to enroll for the class, and to organize a seminar so that your friends can enroll as well.

* * *

Let me be clear: This is not about politics as such. But I believe the ground we will cover is essential for anyone who hopes to be involved in politics over the next several decades to understand. American civilization is, after all, the cultural glue that holds us all together. Unless we can understand it, renew it and extend it into the next century, we will never succeed in replacing the Welfare State with an Opportunity Society

* * *

I have devoted my life to teaching and acting out a set of principles. As a fellow Republican, I know you share those values. This class will help us all remember what we're about and why it is so essential that we prevail. Please join me this Fall for "Renewing American Civilization."

f. In letters sent by GOPAC, a partisan, political role for the course was described

Two letters sent over Mr. Gingrich's name included the following statements:

i. As we discussed, it is time to lay down a blueprint -- which is why in part I am teaching the course on Renewing American Civilization. Hopefully, it will provide the structure to build an offense so that Republicans can break through dramatically in 1996. We have a good chance to make significant gains in 1994, but only if we can reach the point where we are united behind a positive message, as well as a critique of the Clinton program.

ii. I am encouraged by your understanding that the welfare state cannot merely be repaired, but must be replaced and have made a goal of activating at least 200,000 citizen activists nationwide through my course, Renewing American Civilization. We hope to educate people with the fact that we are entering the information society. In order to make sense of this society, we must rebuild an opportunistic country. In essence, if we can reach Americans through my course, independent expenditures, GOPAC and other strategies, we just might unseat the Democratic majority in the House in 1994 and make government accountable again.

Another letter sent over GOPAC's Finance Director's name included the following statement:

iii. As the new finance director, I want to introduce myself and to assure you of my commitment and enthusiasm to the recruitment and training of grassroots Republican candidates. In addition, with the course Newt will be teaching in the fall - Renewing American Civilization- I see a very real opportunity to educate the American voting population to Republican ideals, increasing our opportunity to win local, state and Congressional seats.

25. The course was taught at Kennesaw State College in the fall of 1993 and was taught at Reinhardt College in the winters of 1994 and 1995.

26. Each year the course consisted of forty hours of lectures. Mr. Gingrich presented twenty hours of lecture and a co-professor from each of the respective colleges was responsible for the other twenty hours of the course.

27. Each year the course was taught, it was also broadcast throughout the United States via satellite and local cable channels, and distributed via videotape and audiotape. The broadcasts and tapes only encompassed the twenty hours of lectures presented by Mr. Gingrich. Kennesaw State College Foundation and the Progress and Freedom Foundation were responsible for this dissemination of the course; Reinhardt College was not.

28. The money raised and expended for the course was used primarily for the dissemination of the course as described in paragraph 27. In 1993 course expenditures amounted to approximately $300,000, in 1994 course expenditures amounted to approximately $450,000, and in 1995 course expenditures amounted to approximately $450,000.

29. The main message of the course and the main message of the movement was renewing American civilization by replacing the welfare state with an opportunity society. "Renewing American Civilization" was also the main message of GOPAC and the main message of virtually every political and campaign speech made by Mr. Gingrich in 1993 and 1994. The course was, among other things, the primary means for developing and disseminating this message.

30. Mr. Gingrich described the mission of the course and the movement as follows:

We will develop a movement to renew American Civilization using the 5 pillars of 21st Century Freedom so people understand freedom and progress is possible and their practical, daily lives can be far better. Renewing American Civilization must be communicated as an intellectual-cultural message with governmental-political consequences. As people become convinced American civilization must and can be renewed and the 5 pillars will improve their lives we will encourage them and help them to network together and independently, autonomously initiate improvements wherever they want. However, we will focus on economic growth, health, and saving the inner city as the first three key areas to improve. Our emphasis will be on reshaping law and government to facilitate improvement in all of american [sic] society. We will emphasize elections, candidates and politics as vehicles for change and the news media as a primary vehicle for communications. To the degree Democrats agree with our goals we will work with them but our emphasis is on the Republican Party as the primary vehicle for renewing American civilization.

31. In a memorandum addressed to "Various Gingrich Staffs," which included GOPAC employees and consultants as well as people involved in Mr. Gingrich's campaign, Mr. Gingrich described the broad application of the Renewing American Civilization message as follows:

I believe the vision of renewing American civilization will allow us to orient and focus our activities for a long time to come.

At every level from the national focus of the Whip office to the 6th district of Georgia focus of the Congressional office to the national political education efforts of GOPAC and the re-election efforts of FONG we should be able to use the ideas, language and concepts of renewing American civilization.

He then described the role of the course in this process:

The course is only one in a series of strategies designed to implement a strategy of renewing American civilization.

Another of Mr. Gingrich's strategies involving the course was:

Getting Republican activists committed to renewing American civilization, to setting up workshops built around the course, and to opening the party up to every citizen who wants to renew American civilization.

32. In writing about the goals of the movement, Mr. Gingrich wrote:

Our overall goal is to develop a blueprint for renewing America by replacing the welfare state, recruit, discover, arouse and network together 200,000 activists including candidates for elected office at all levels, and arouse enough volunteers and contributors to win a sweeping victory in 1996 and then actually implement our victorY in the first three months of 1997.

The "sweeping victory" referred to in this document is by Republicans. Mr. Gingrich went on to describe the specific goals within the overall goal, all of which were to be accomplished through the course.

1. By April 1996 have a thorough, practical blueprint for replacing the welfare state that can be understood and supported by voters and activists.

We will teach a course on Renewing American civilization on ten Saturday mornings this fall and make it available by satellite, by audio and video tape and by computer to interested activists across the country. A month will then be spent redesigning the course based on feedback and better ideas. Then the course will be retaught in Winter Quarter 1994. It will then be rethought and redesigned for nine months of critical re-evaluation based on active working groups actually applying ideas across the country the course will be taught for one final time in Winter Quarter 1996.

2. Have created a movement and momentum which require the national press corps to actually study the material in order to report the phenomenon thus infecting them with new ideas, new language and new perspectives.

3. Have a cadre of at least 200,000 people committed to the general ideas so they are creating an echo effect on talk radio and in letters to the editor and most of our candidates and campaigns reflect the concepts of renewing America.

Replacing the welfare state will require about 200,000 activists (willing to learn now [sic] to replace the welfare state, to run for office and to actually replace the welfare state once in office) and about six million supporters (willing to write checks, put up yard signs, or do a half day's volunteer work).

33. In a speech at a GOPAC training seminar for candidates at the Virginia Republican Convention in June 1993, Mr. Gingrich described a partisan goal of the movement.

We can't do much about the Democrats. They went too far to the left; they're still too far to the left; that's their problem. But we have a huge burden so that everyone who wants to replace the welfare state and everyone who wants to renew Arnerican civilization has a home, and it's called being a Republican. We have to really learn how to bring them all in.

He then discussed the role of the course in the movement and described how the "five pillars" of the Renewing American Civilization course could be applied to political campaigns.

Now, let me start just as a quick overview. First, as I said earlier, American civilization is a civilization. Very important. It is impossible for anyone on the left to debate you on that topic.

* * *

But the reason I say that is if you go out and you campaign on behalf of American civilization and you want to renew American civilization, it is linguistically impossible to oppose you. And how is your opponent going to get up and say I'm against American civilization?

Near the end of the speech he stated:

I believe, if you take the five pillars I've described, if you find the three areas that will really fit you, and are really in a position to help you, that you are then going to have a language to explain how to replace the welfare state, and three topics that are going to arouse volunteers and arouse contributions and help people say, Yes, I want this done.

34. In a number of other instances, Mr. Gingrich applied the ideas of the course to partisan, political purposes. Examples include:

a. In a document entitled "House Republican Focus for 1994" Mr. Gingrich wrote:

The Republican party can offer a better life for virtually everyone if it applies the principles of American civilization to create a more flexible, decentralized market oriented system that uses the Third Wave of change and accepts the disciplines of the world market.

These ideas are outlined in a 20 hour intellectual framework "Renewing American Civilization" available on National Empowerment Television every Wednesday from 1 pm to 3 pm and available on audio tape and video tape from 1-800-TO RENEW.

b. In a document Mr. Gingrich said was a briefing paper for House Republican Members, he described the movement to renew American civilization. Renewing American civilization required the replacement of the welfare state with an opportunity society. He wrote that doing this will require at least 200,000 "partners for progress" willing to study the principles of American civilization, work on campaigns, run for office, and engage in other activities to further the movement. Under the heading "LEARNING THE PRINCIPLES OF AMERICAN CIVILIZATION" Mr. Gingrich wrote, "The course, 'Renewing American Civilization', is designed as a 20 hour introduction to the principles necessary to replace the welfare state with an opportunity society . On the next page entitled "Connecting the 'Partners' to the 'Principles', "' Mr. Gingrich described where the course was being taught, including the fact that it was being broadcast for fifty weeks during 1994 on National Empowerment Television. He then wrote that, "Our goal is to get every potential partner for progress to take the course and study the principles."

c. In a document entitled "The 14 Steps Renewing American Civilization by replacing the welfare state with an opportunity society," Mr. Gingrich described a relationship between the course and the movement. He began with the proposition that the welfare state had failed and needed to be replaced. In describing the replacement, Mr. Gingrich wrote that it:

must be an opportunity society based on the principles of American civilization .

These principles each receive two hours of introduction in 'Renewing American Civilization', a course taught at Reinhardt College. The course is available on National Empowerment Television from 1 - 3 P.M. every Wednesday and by videotape or audiotape by calling 1-800-TO-RENEW.

Mr. Gingrich then wrote:

The Democrats are the party of the welfare state. Too many years in office have led to arrogance of power and to continuing violations of the basic values of self-governrnent.

Only by voting Republican can the welfare state be replaced and an opportunity society be created.

35. From in or about June 1993 through in or about December 1993, the course was funded and operated with tax-exempt funds under the auspices of the Kennesaw State College Foundation, an organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code. From in or about December 1993 through in or about July 1995, the course was funded and operated under the auspices of the Progress and Freedom Foundation, an organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code. In 1994 and 1995 the course was taught at Reinhardt College, an organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code.

36. Under the Internal Revenue Code, an organization which is exempt from taxation under section 501(c)(3) must be operated exclusively for exempt purposes. The presence of a single non-exempt purpose, if more than insubstantial in nature, will destroy the exemption regardless of the number or importance of truly exempt purposes. Conferring a benefit on private interests is a non-exempt purpose. Under the Internal Revenue Code, an organization which is exempt from taxation under section 501(c)(3) is also prohibited from any participation in a political campaign or from providing any support to a political action comrnittee. These prohibitions reflect Congressional concerns that tax-payer funds not be used to subsidize political activity.

37. Although Mr. Gingrich consulted with the House Committee on Standards of Official Conduct ("Committee") prior to teaching the course, he did not seek specific legal advice concerning the application of section 501(c)(3) of the Internal Revenue Code in regard to the facts described in paragraphs 17 through 35 from an appropriate source and did not take affirmative steps to ensure that such legal advice was obtained by others from an appropriate source.

38. During the Preliminary Inquiry the Subcommittee consulted with an expert in the law of tax-exempt organizations. Mr. Gingrich's activities on behalf of the Kennesaw State College Foundation, the Progress and Freedom Foundation, and Reinhardt College in regard to the course entitled "Renewing American Civilizationw and the activities of others on behalf of those organizations with Mr. Gingrich's knowledge and approval were reviewed by the expert. The expert concluded that those activities violated Kennesaw State College Foundation's status under section 501(c)(3) of the Internal Revenue Code, the Progress and Freedom Foundation's status under section 501(c)(3) of the Internal Revenue Code, and Reinhardt College's status under section 501(c)(3) of the Internal Revenue Code in that, among other things, those activities were intended to confer more than insubstantial benefits on Mr. Gingrich, GOPAC, and other Republican entities and candidates.

39. The Subcommittee also heard from tax counsel retained by Mr. Gingrich for the purposes of this Preliminary Inquiry. According to Mr. Gingrich's tax counsel, this type of activity would not violate the status of the Kennesaw State College Foundation, the Progress and Freedom Foundation, or Reinhardt College under section 501(c)(3) of the Internal Revenue Code.

40. Both the Subcommittee's expert and Mr. Gingrich's tax counsel agree that had they been consulted about this type of activity prior to its taking place, they would have advised that it not be conducted under the auspices of an organization exempt from taxation under section 501(c)(3) of the Internal Revenue Code.

41. If the legal advice described in paragraph 40 had been sought and followed, most, if not all, of the tax-deductible charitable contributions would not have been used for the activities described in paragraphs 17 through 35. As a result, the public controversy involving the legality of a Member's involvement with orgaIiizations exempt from taxation under section 501(c)(3) of the Internal Revenue Code concerning activities described in paragraphs 17 through 35 would not have occurred.

42. On or about September 7, 1994, a complaint was filed against Mr. Gingrich with the Committee. The complaint centered on the course entitled "Renewing American Civilization." Among other things, it alleged that Mr. Gingrich had used his congressional staff to work on the course and that he had misused organizations that were exempt from taxation under section 501(c)(3) of the Internal Revenue Code because the course was a partisan, political project, with significant involvement by GOPAC, and was not a permissible activity for a section 501(c)(3) organization.

43. On or about October 4, 1994, Mr. Gingrich wrote the Committee in response to the complaint and primarily addressed the issues concerning the use of congressional staff for the course. In doing so he stated:

I would like to make it abundantly clear that those who were paid for course preparation were paid by either the Kennesaw State Foundation, [sic] the Progress and Freedom Foundation or GOPAC.... Those persons paid by one of the aforementioned groups include: Dr. Jeffrey Eisenach, Mike DuGally, Jana Rogers, Patty Stechschultez [sic], Pamla Prochnow, Dr. Steve Hanser, Joe Gaylord and Nancy Desmond.

44. On or about October 31, 1994, the Committee sent Mr. Gingrich a letter asking for additional information concerning the allegations of misuse of tax-exempt organizations in regard to the course. The Committee also asked for information relating to the involvement of GOPAC in various aspects of the course.

45. Whether any aspects of the course were political or partisan in their motivation, application, or design was material to the Committee's deliberations in regard to the complaint. Whether GOPAC had any involvement with the course was also material to the Committee's deliberations in regard to the complaint.

46. In November 1994, Mr. Gingrich retained counsel to represent him in connection with the Cornmittee's investigation. According to Mr. Gingrich, he then relied on counsel to respond to and otherwise address issues and concerns raised by the Committee. Mr. Gingrich, however, remained ultimately responsible for fully, fairly, and accurately responding to the Committee.

47. Between on or about December 8, 1994, and on or about December 15, 1994, Mr. Gingrich delivered or caused to be delivered to the Committee a letter dated December 8, 1994, signed by Mr. Gingrich in response to the Committee's letter described in paragraph 44. According to testimony before the Subcommittee, the six-page December 8, 1994 letter was prepared by Mr. Gingrich's attorney and submitted to Mr. Gingrich for review during the transition following the 1994 election. In the December 8, 1994 letter Mr. Gingrich made the following statements:

[The course] was, by design and application, completely non- partisan. It was and remains about ideas, not politics. (Page 2).

The idea to teach "Renewing American Civilization" arose wholly independent of GOPAC, because the course, unlike the committee, is non-partisan and apolitical. My motivation for teaching these ideas arose not as a politician, but rather as a former educator and concerned American citizen .... (Page 4).

The fact is, "Renewing American Civilization" and GOPAC have never had any official relationship. (Page 4).

GOPAC . . . is a political organization whose interests are not directly advanced by this non-partisan educational endeavor. (Page 5).

As a political action committee, GOPAC never participated in the administration of "Renewing American Civilization." (Page 4).

Where employees of GOPAC simultaneously assisted the project, they did so as private, civic-minded individuals contributing time and effort to a 501(c)(3) organization. (Page 4).

Anticipating media or political attempts to link the Course to [GOPAC], "Renewing American Civilization" organizers went out of their way to avoid even the appearances of improper association with GOPAC. Before we had raised the first dollar or sent out the first brochure, Course Project Director Jeff Eisenach resigned his position at GOPAC. (Page 4).

48. On or about January 26, 1995, an amended complaint against Mr. Gingrich was filed with the Committee. The amended complaint encompassed the same allegations as the complaint described in paragraph 42, as well as additional allegations.

49. On or about March 27, 1995, Mr. Gingrich's attorney prepared, signed, and caused a fifty-two page letter dated March 27, 1995, with 31 exhibits to be delivered to the Committee responding to the amended complaint. The March 27, 1995 letter was submitted to Mr. Gingrich shortly before it was filed with the Committee.

50. Prior to the letter from Mr. Gingrich's attorney being delivered to the Committee, Mr. Gingrich reviewed it and approved its submission to the Committee. The ultimate responsibility for the accuracy of information submitted to the Committee remained with Mr. Gingrich.

51. The March 27, 1995 letter contains the following statements:

As Ex. 13 demonstrates, the course solicitation . . . materials are completely non-partisan. (Page 19, footnote 1).

GOPAC did not become involved in the Speaker's academic affairs because it is a political organization whose interests are not advanced by this non-partisan educational endeavor. (Page 35).

The Renewing American Civilization course and GOPAC have never had any relationship, official or otherwise. (Page 35).

As noted previously, GOPAC has had absolutely no role in funding, promoting, or administering Renewing American Civilization. (Pages 34-35).

GOPAC has not been involved in course fundraising and has never contributed any money or services to the course. (Page 28).

Anticipating media or political attempts to link the course to GOPAC, course organizers went out of their way to avoid even the appearance of associating with GOPAC. Prior to becoming Course Project Director, Jeffrey Eisenach resigned his position at GOPAC and has not returned. (Page 36).

52. Mr. Gingrich engaged in conduct that did not reflect creditably on the House of Representatives in that: regardless of the resolution of whether the activities described in paragraphs 2 through 41 constitute a violation of section 501(c)(3) of the Internal Revenue Code, by failing to seek and follow the legal advice described in paragraphs 15 and 40, Mr. Gingrich failed to take appropriate steps to ensure that the activities described in paragraphs 2 through 41 were in accordance with section 501(c)(3) of the Internal Revenue Code; and on or about March 27, 1995, and on or about December 8, 1994, information was transmitted to the Committee by and on behalf of Mr. Gingrich that was material to matters under consideration by the Committee, which information, as Mr. Gingrich should have known, was inaccurate, incomplete, and unreliable.

53. The conduct described in this Statement of Alleged yiolation constitutes a violation of Rule 43(1) of the Rules of the United States House of Representatives.