Thursday, July 25, 2013

Fraternities Lobby for Tax Break Without Hazing Penalties - Bloomberg

Meanwhile on Capitol Hill - the Fraternity lobby is pushing for a tax break for building and restoring greek housing. Further, there is resistance to a federal anti-hazing measure.

Fraternities Lobby for Tax Break Without Hazing Penalties - Bloomberg:

About 40 percent of U.S. senators, and 25 percent of U.S. representatives, belonged to fraternities or sororities in college. On April 24, more than a dozen of these grateful alumni extolled Greek life at an annual $500-a-plate dinner in a Washington hotel ballroom for “FratPAC,” the industry’s political arm.

One by one, they took the podium and praised fraternities for teaching them loyalty, leadership, and practical skills.
A 1996 fraternity house fire at the University of North Carolina that killed five students spurred the industry’s drive for the tax break. About half of all fraternity houses lack sprinklers, according to an internal industry memorandum reviewed by Bloomberg News. Photographer: Joe Weiss/Durhan Herald-Sun via AP Photo
“We learned to tap a keg,” declared Representative Steven Palazzo, a Mississippi Republican and Sigma Chi brother, who then yelled a cheer as hundreds of FratPAC donors applauded.

Many of the legislators also pledged support for FratPAC’s pet legislation: a multi-million-dollar tax break to let fraternities and sororities use charitable donations to renovate and help build chapter houses.

“This time, we think we can get it done,” said Ohio Republican Steve Stivers, a Delta Upsilon alumnus, adding, “We need more Greeks in Congress.”

While fraternities used to limit their political activity to fending off potential threats, they’re “playing offense today” by promoting initiatives such as the tax break, FratPAC and two companion groups told fraternity leaders in a Jan. 10, 2011, memo.

Besides pushing the tax bill, FratPAC, as the Fraternity and Sorority Political Action Committee calls itself on its Twitter page, has helped dissuade U.S. Representative Frederica Wilson from filing federal anti-hazing legislation. Wilson, a Democrat, is co-sponsoring the tax proposal with six senators and more than 50 other representatives.

Hazing Death
Debbie Smith, whose 21-year-old son died in 2005 from heart failure and seizures after a hazing ritual, is “dumbfounded” by the industry’s lobbying for a tax break and against national hazing penalties, she said.

Smith’s son, Matthew Carrington, collapsed after being forced to do pushups in raw sewage while fans blasted cold air on him in a basement at Chi Tau fraternity at California State University in Chico. After his death, her advocacy spurred the California legislature to enact “Matt’s Law,” toughening hazing penalties.

“Why do fraternities need government help?” Smith asked. “They want to build more houses for hazing? I don’t think so. They need to learn safety first.”

Fraternities’ Comeback
Attracting undergraduates with aggressive recruiting and the prospect of jobs at Wall Street firms and other fields dominated by Greek alumni, fraternities are making a comeback on college campuses.

Meanwhile the toll from hazing and binge drinking is mounting. The 101 fraternities and sororities in the industry’s trade groups had 630,052 members in 2012, up 25 percent from 503,875 in 2007. Since 2005, 59 students have died in incidents involving fraternities, about half of them alcohol-related, according to data compiled by Bloomberg. Ten students died in 2012, the most fatalities in at least a decade.

A 1996 fraternity house fire at the University of North Carolina that killed five students spurred the industry’s drive for the tax break. They decided that they needed a federal law to let them tap funds in their charitable foundations to outfit chapter houses with fire sprinklers. About half of all fraternity houses lack sprinklers, according to an internal industry memorandum reviewed by Bloomberg News.

In 2003, the tax bill passed the House. Two years later, fraternities and sororities established FratPAC, which has contributed $818,000 to political campaigns, primarily to Republicans. It has made some of its largest contributions to key backers of its tax initiative, and to members of the House Ways and Means committee, where the bill is pending.

Link to full story on Bloomberg: