Sierra Club latest environmental charity hit by Revenue Canada audits

Another environmental charity is about to undergo a political-activity audit by the Canada Revenue Agency, in what the charity's director says is part of an "intimidation campaign."

Auditors are set to appear at the Ottawa offices of the Sierra Club Canada Foundation on May 11 to examine the books for evidence of excessive political activity.

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"It's a huge undertaking for us to do this," said John Bennett, the foundation's national program director, who has been asked to produce a list of all the politicians he met in 2012 and 2013, among other documentation.

The audit was to have started in February, but Bennett was given a two-month reprieve to assemble the material the agency is demanding, including an accounting of the political activity its many unpaid volunteers may have undertaken.

"It's an accounting nightmare for us to figure out how to do it," Bennett said in an interview.

The Harper government's 2012 budget launched a series of 60 political-activity audits of charities, with a budget that has grown to more than $13 million through to 2017.

The audits are to determine whether any groups engaged in partisan activity, which is forbidden, or broke a rule limiting the resources devoted to political activities to no more than 10 per cent.

The initial wave of audits hit environmental charities, after several Conservative cabinet ministers vilified environmentalists as "radicals" and "money launderers," with possible links to terrorists. Many such charities had vocally opposed government energy and pipeline policies.

Denies any bias in selection

The audits have since widened to include poverty, international development and human-rights groups, among others, many of them also critical of Harper government policies. One group, Dying With Dignity, has had its registration annulled, while others such as Environmental Defence are appealing notices to deregister.

National Revenue Minister Kerry-Lynne Findlay has repeatedly denied any bias in the selection of charities to audit, saying CRA officials make their own independent decisions without political input.

It is an abuse of power- John Bennett, Sierra Club Canada Foundation

CRA spokesman Philippe Brideau declined comment on the Sierra Club Canada Foundation audit, citing confidentiality provisions of the Income Tax Act. The agency has not released a master list of charities undergoing political-activity audits.

Critics and spokespersons for charities say the audits have created an "advocacy chill," as groups self-censor for fear of retribution.

The foundation escaped the first wave of political-activity audits in 2012, though Bennett says that was likely because the group had passed a regular CRA audit in January 2011. Like other environmental groups, the foundation was the focus of formal complaints to the tax agency by EthicalOil.org for its alleged political activities, particularly with regard to the energy sector.

EthicalOil.org promotes Canadian oil exports as ethical because of the country's positive record on human rights compared with other oil-exporting nations.

Called 'intimidation'

"Clearly, the governing party is targeting groups it sees as its political enemies and is using the taxpayer's money and a government enforcement agency to do it," Bennett said in a recent fundraising letter.

"It is an intimidation campaign designed to harass and distract organizations from doing the charitable work their donors want them to do … it is an abuse of power."

The foundation reported revenues of about $700,000 in its 2013 filing with Canada Revenue Agency. Bennett is the only full-time employee in the Ottawa office, with two part-time staff and a summer student.

The Sierra Club Canada Foundation has been registered as a charity since 1971. Elizabeth May, now Green Party leader, was executive director from 1989 to 2006, when the group had some 20 staff.

As of March 31, the Canada Revenue Agency had completed 21 political-activity audits, with 28 still under way and 11 still to begin. So far, five charities have received notices of the agency's intention to revoke their charitable status.

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