Tax filings raise questions about Las Vegas charity for fallen cops

Injured Police Officers FundNearly two years ago, not long after becoming New To Las Vegas, I wrote in this space about the Injured Police Officers Fund. It’s a now-36-year-old Las Vegas-based charity accepting tax-deductible contributions whose stated mission is to “provide financial assistance to families of officers injured or killed in the line of duty” in Southern Nevada.

Based on my review of the organization’s 2015 federal tax return and my many years writing about nonprofits, I declared then that the IPOF, which sometimes pops up in the local news after an officer is hurt or killed, seemed a cut above most law enforcement-themed charities. This was mainly because the IPOF eschewed direct mail and telephone cold-calling in its fundraising efforts and so didn’t hand over most of the money raised to outside paid telemarketers, as was often the case with cop charities.

But fundraising is only one part of any charity’s performance. So when the IPOF’s tax return for 2017 became public record last month, I decided to find filings as many years back as I could to make a long-term assessment. I was able to locate 17 tax returns in the public record from 2001 to 2017–nearly half the IPOF’s entire existence. Putting all the data on a spreadsheet, I crunched the numbers.

Alas, I regret to say that the larger picture suggests a number of troubling questions about how the money the IPOF received was spent–or not. And since I last wrote about the charity, it seems that wives of some police officers have started asking pointed questions of their own about the IPOF. They even have an open Facebook group page suggesting that something iffy is afoot.

Over those 17 years, the IPOF received $3,326,554 in contributions, net special event proceeds, other income and investment returns. But just $668,619 was handed out in grants to individual police families–the sole stated purpose of the charity listed in the filed-under-penalty-of-perjury tax return. That’s only 20% of the total revenue. Nearly double that amount–$1,181,841–was spent for management and general administration expenses like accounting–overhead, as it’s commonly known. Indeed, in only two years was the amount given to families higher than the overhead. In five of those 17 years, more was spent just on accounting than for grants.

That’s a lot of overhead especially given the fact that in the last five years for which the number of individual grants was listed on the tax returns, only seven grants were made each year on average. From 2013 to 2017, the average grant was for $8,045. Overhead per grant: $13,785, which was a lot more.

In evaluating charities, a standard measure of financial efficiency is the charitable commitment ratio. That’s defined as the percent of total expenses (not revenue) spent in furtherance of the stated mission, as opposed to overhead and fundraising expense. Charitable watchdogs like the Better Business Bureau Wise Giving Alliance say anything under 65% is simply unacceptable.

Using the IPOF’s own data as classified on its own tax filings, the charitable commitment ratio over 17 years: 40%. A lot worse. In only one year–way back in 2002–did the IPOF’s charitable commitment ratio beat the BBB minimum standard, so the under-performance has been pretty consistent.

The just-filed tax return for 2017–the year of the October 1 massacre along the Las Vegas Strip–did not boost this average ratio. It listed stated-mission expenses of $94,567–mainly $87,640 in grants to 13 recipients–out of total expenses of $263,554. That worked out to a charitable commitment ratio of just 36%. (The ratio for 2016 was even worse: 10%.)

More than half of the $168,987 listed in non-stated mission overhead for 2017 was the $86,848 salary of the IPOF’s single paid employee, Minddie Lloyd, who lost a race for Clark County Clerk last month as a Republican (running, amazingly to me, on a stated platform of improving “cost efficiency.”) That was more than four times higher than the $20,000 she was paid in 2015 and 2016, and almost equal to the $87,640 given out in individual grants in 2017. It may or may not be significant that the pay raise came as her husband, Erik Lloyd, a Metro Police lieutenant, became the IPOF’s president after years as its vice president and a director. During 2017 press releases called her the IPOF’s executive director, although that formal title did not appear on the tax return.

Still, the 2017 IPOF tax return asked, “Did any officer, director, trustee or key employee have a family relationship or a business relationship with any other officer, director, trustee or key employee?” One might think the Lloyds–he the president, she the executive director–were both officers, which the IRS officially defines for nonprofits as anyone holding a position of trust, authority or command. But the question on the tax return was answered “No.”

In one way, 2017 was a record year for the IPOF. It received $1,348,501 in contributions, the only year in the past 17 in which gifts topped $1 million, or even $200,000. According to the tax return and a press release issued in late 2017, a cool $1 million of that amount were the proceeds of a classic car auction held in Las Vegas a few weeks after the October 1 massacre donated by Barrett-Jackson (no relation to me), a Scottsdale, Ariz., car auction company. This was a major reason why the IPOF showed net assets of $2,333,855 on December 31, 2017.

Yet there even seems to be a question about this. In July 2018 the IPOF issued a press release saying that the “Barrett-Jackson donation”–presumably that $1 million–was distributed to “deserving first responder organizations” in Nevada. Not a penny was mentioned as going to “families of officers injured or killed in the line of duty”–as I noted earlier, the stated mission, and only stated mission, of the IPOF.

The press release listed 27 recipients. Among them: the North Las Vegas Police Department Honor Guard, the Henderson Police Department Honor Guard, the City of Las Vegas Honor Guard, the Boulder City Police Department Honor Guard, the Mesquite Police Department Honor Guard, and the Clark County Park Police Honor Guard, and Friends of Las Vegas Metro Police Department Honor Guard.

Honor guards are certainly not families of fallen officers. But how are they even first responders?

There are other questions. It does not appear the IPOF has ever issued an audited financial statement, which might provide more confidence and clarity about what’s going on. And according to its tax returns, the IPOF does business on a cash accounting basis–counting money in and money out during the fiscal period. While legal, this is more susceptible to manipulation than more traditional accrual accounting.

The IPOF was founded in 1982 after concern over uninsured expenses of a police officer shot in the head during a traffic stop. The idea developed to provide financial assistance not covered by medical insurance, workers compensation and long-term care policies. The IPOF board consists of representatives appointed by the heads of about a dozen law enforcement agencies operating in Southern Nevada.

To its credit, the IPOF spends almost nothing on fundraising–over 17 years, just 1% of the donations received, well under the 35% maximum limit set by the BBB, and zero percent in all but two years. Donations came in from a few corporate donors, from the public, often after a police officer’s death gets wide publicity; and from the proceeds of special events like an annual golf tournament.

But even that can be hazardous. According to a story earlier this month in the Las Vegas Review-Journal, an unidentified Clark County School District police officer suffered a head injury after falling off a golf cart at an IPOF fundraising golf tournament at Bali Hai Golf Club on the Las Vegas Strip. Alcohol may or may not have been a factor.

For a tax-exempt nonprofit happy to accept donations, the IPOF is surprisingly secretive. It does not post its public-record tax return on its website as many charities now do as a matter of best practices. Indeed, the IPOF discouragingly stated on the tax return that it was “not made available to the public.” This is not true at all. Federal law absolutely requires disclosure by a charity of its tax return to anyone who asks. I’m a member of the public, and I got the 2017 return, as well as the returns for 2015 and 2016, by making a request to the IPOF.

The secrecy seems to have helped stir up what I would consider a formidable force: spouses of police officers. In August some of them started a Facebook group page, Injured Police Officers Fund Community Sharing. Its pointed hashtag is @ipoftruthseekers. The page calls itself “a group of Las Vegas citizens with serious concerns how a local non-profit is allocating money they collect under the mask of helping our Injured police.” Anyone on Facebook–which worldwide now has about 2¼ billion monthly users–can see the content.

Posted are questions about unfunded requests and unanswered calls, as well as pages from IPOF tax returns. One spouse put up a 48-minute video attacking the IPOF and its officers on a variety of grounds, raising lots of questions. On the day after Republican Minddie Lloyd lost her race for Clark County Clerk by a landslide (to a Democratic incumbent with a recent DUI arrest on her record), someone posted the results with this comment: “The people have spoken.”

Earlier this week I emailed a request for comment to the Lloyds as well as the IPOF lawyer, detailing most of the points made in this post. I haven’t heard back, but will update this if I do.

Right now, there are a lot more questions than answers.

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