AIG's ambivalent relation to the tax code

Posted 30 September 2014 by Matt Young

Schrödinger's cat is, famously, both dead and alive, simultaneously. There has been doubt as to whether macroscopic objects could be prepared in cat states, but Answers in Genesis has done it! As Ed Hensley of the Kentucky Secular Society observes below, AIG is both a nonprofit and a for-profit entity, simultaneously (a condition that we noted earlier on PT). Following up on material that Dan Phelps acquired under the Freedom of Information Act, Mr. Hensley sent the following (lightly edited) press release to a number of interested journalists: I wanted to provide you with Ark Encounter documents from a Freedom of Information Act request by Dan Phelps of the Kentucky Paleontological Society. There are also some related files. These can all be accessed here. FOIA documents are numbered ark02.pdf through ark46.pdf. ark02.pdf - ark06.pdf include the Ark Encounter application for the grant and other foundational documents. ark07.pdf - ark46.pdf are letters and e-mails roughly in chronological order. Non-FOIA documents include annual filing statements by Ark Encounter, Answers In Genesis, and Crosswater Canyon with the state of Kentucky, Crosswater Canyon Articles of Incorporation, Williamstown Bond Summary, an AIG fundraising letter, and images of books written by Ken Ham and America's Resource Group CEO Britt Beemer (AIG claims of projected 2 million in attendance are based on claims by Ken Ham's co-author Beemer). I wish to point out the following facts: ANSWERS IN GENESIS, CROSSWATER CANYON, AND ARK ENCOUNTER ARE ESSENTIALLY ONE AND THE SAME ORGANIZATION. 1. Answers In Genesis (AIG) is a non-profit ministry. 2. Crosswater Canyon is a non-profit ministry owned by AIG; it operates the Creation Museum and will operate Ark Encounter. 3. Ark Encounter is a for-profit company owned by AIG. 4. Ark Encounter's annual filing statement lists Crosswater Canyon as the manager and has the same address as the Creation Museum. 5. Crosswater Canyon's filing statement has the same address as the Creation Museum and is signed by John Pence. 6. Answers In Genesis's filing statement is signed by John Pence. 7. Ark Encounter's application lists John Pence as the contact. WHEN AIG SEEKS TAX-FREE DONATIONS, THEY ACT AS THE NON-PROFIT AIG. 1. See documents aig01.pdf and aig02.pdf for example of a fundraiser where AIG claims donations to Ark Encounter are deductible from federal taxes because AIG is a 501(c)3 non-profit. 2. Ken Ham calls the ark an "evangelical ark" and says, "I believe the evangelistic Ark is a great Kingdom investment opportunity!" The last link goes to a donation page for AIG, where they claim donations can be exempted from federal taxes because AIG is a 501(c)3. There are numerous other examples of such links in AIG and Ark Encounter websites. See here. WHEN AIG SEEKS KENTUCKY SALES TAX REBATES, THEY ACT AS THE FOR-PROFIT ARK ENCOUNTER. 1. The application for the sales tax rebates was submitted by Ark Encounter. 2. AIG admits that they created Ark Encounter in order to apply for the Kentucky sales tax rebate program (click Why Is The Project So Big, and Why Is A For Profit LLC Going To Own Ark Encounter: "The for-profit LLC structure also allows the Ark Encounter to be eligible for various economic development incentives that would not have been available with a non-profit structure.") THERE ARE QUESTIONS ON THE LEGALITY OF AIG-ARK ENCOUNTER CLAIMS AS BOTH A NON-PROFIT AND FOR-PROFIT. Attorneys of various organizations are examining this issue. AIG ACTIVELY PRACTICES RELIGIOUS DISCRIMINATION IN EMPLOYMENT FOR ARK ENCOUNTER JOBS. Even though AIG has removed its "Statement of Faith" from its website and application, it still asks its applications to "Please provide brief details of current church membership and attendance", "How old would you estimate the earth to be?", "Please provide your Salvation testimony", "Please provide your Creation belief statement", and "Please write your confirmation of your agreement with the AIG Statement of Faith". See here. AIG PLANS ON USING THE ARK FOR EVANGELISM. In document ark14.pdf, Kentucky General Counsel William Dexter is concerned about AIG statements on Feb 27, 2014, that the ark would be used for evangelism and expressed concerns about the legality of Kentucky sales tax rebates being granted for an evangelistic ministry. Ken Ham and AIG ignore these concerns, recently referring to the ark as an "evangelistic ark" (again see here). I encourage all journalists to examine the FOIA documents for themselves and to help inform the citizens of Kentucky about the details of the structure of the organizations and the fact that Kentucky is considering giving $18 million in tax rebates to a religious ministry. #### Dan Phelps adds that he

found it fascinating that the documents I obtained under the Kentucky Open Records Act documented that the Tourism Cabinet's attorney allowed an attorney from Louisiana, Mike Johnson, to change the language of the agreement between the state and Ark Encounter. The original tax incentive from 2010/2011 stated that there was to be no discrimination in hiring for Ark Encounter jobs. Mr. Johnson convinced the State's attorney to change the language so that they can argue that it is OK for Ark Encounter to discriminate. Mr. Johnson, incidentally, is running for a seat in District 8 of the Louisiana Legislature. See Mr. Johnson's website here. Our Tourism Cabinet is bowing to an extreme far-right Republican political candidate from another state, while ignoring its own attorneys.

21 Comments

Henry J · 30 September 2014

For some reason, this reminds me of Kent Hovind...

Just Bob · 30 September 2014

Henry J said: For some reason, this reminds me of Kent Hovind...

Hmm... now where is old Kent these days?

Matt Young · 30 September 2014

I do not know what happened, but most or all the links in this article refer to the article itself. I will try to fix them tonight, but not for several hours -- off to a concert at the University right now.

Matt Young · 30 September 2014

The links are fixed. Apparently I committed the indiscretion of using Microsoft Word to format the piece. It in turn automatically formatted the links; when I Removed Hyperlink to eliminate extraneous codes, it also deleted some of my html code. Gatesware strikes again!

At any rate, dear reader, all seems well now, and you may peruse the links at will. May the IRS do likewise.

DS · 1 October 2014

Can Ken Ham go to jail for tax fraud and attempted tax evasion? If so, would he share a cell with Kent Hovind?

Doc Bill · 1 October 2014

If anyone should go to jail it should be the State of Kentucky!

Hovind was sneaky and clearly broke the law. He was moving money around and attempting to hide his assets.

Sly old Hambo is right out there in the light of day! He's not being sneaky about his shell companies and never has been. It's all been transparent from the beginning. It's Kentucky, the governor and the tourism board and the city of Williamstown who are being stupid.

I wonder if somebody in Kentucky government is on the take. Can the tourism board be so completely delusional that they actually believe a building that looks like a boat and a petting zoo is going to bring in TWO MILLION tourists?

DS · 1 October 2014

I'm sure it's no big deal. I'm sure they are just covering their bets. I'm sure they are just afraid that no one will show up and they will become a non-profit, regardless of their plans. And of course if someone did show up and they did manage to somehow turn a profit, I'm sure they would be honest and report that they had lost their no-profit status. That's what Jesus would do. Or maybe not. Maybe Jesus would just look at the admission charge and turn over all the tables. He might be heard muttering as he walked away: "In my name? Really guys? Really?"

Anyway, too bad they can't make it a non-prophet organization. Now that would be a dose of reality.

EdHensley · 1 October 2014

Doc Bill said: If anyone should go to jail it should be the State of Kentucky! Hovind was sneaky and clearly broke the law. He was moving money around and attempting to hide his assets. Sly old Hambo is right out there in the light of day! He's not being sneaky about his shell companies and never has been. It's all been transparent from the beginning. It's Kentucky, the governor and the tourism board and the city of Williamstown who are being stupid. I wonder if somebody in Kentucky government is on the take. Can the tourism board be so completely delusional that they actually believe a building that looks like a boat and a petting zoo is going to bring in TWO MILLION tourists?

The 2 million visitors estimate came from America's Research Group (ARG - argconsumer.com) in a study for AIG prior to the 2010 proposal. Britt Beemer is the CEO of ARG. He is the co-author with Ken Ham of the book Already Gone (http://www.amazon.com/Already-Gone-your-kids-church/dp/0890515298/ref=sr_1_1?ie=UTF8&qid=1412184428&sr=8-1&keywords=already+gone) and his research was featured in the book Already Compromised written by Ham (http://www.amazon.com/Already-Compromised-Ken-Ham/dp/0890516073/ref=pd_bxgy_b_img_y). Therefore, the estimates by Britt Beemer are biased for two reasons: 1) Beemer is a co-author with Ham who; 2) ARG study was not on the current proposal ($72 million, ark only) but was on the 2010 proposal, which was a multi-day, $173 million park (with 10 plagues ride, Tower of Babel, etc.) Kentucky hired Hunden of Chicago to do its own study in 2010 for the $173 million project. That study claimed attendance would be 1.2 million if the park had a "traditional" ark but would be only 800,000 if the park followed the AIG creationism model. Kentucky hired Hunden to do another study for the 2014 proposal. Since the 2014 proposal is only an ark and is only $72 million, Todd Cassidy of the KY Tourism Cabinet expects the Hunden numbers to be lower than the 2010 projections. The Hunden report had not returned at the time the Kentucky Open Records Act documents were obtained.

DS · 1 October 2014

Ten plagues ride, man sign me up. That sounds like loads of fun! No wonder they expect so many visitors with attractions like that! Will ebola be the first or the last plague? Will the black death make the list, or will it be just the same old locust stuff? How about H1N1, aids and other favorites? Is it going to be updated every year or just biblical stuff? Man they are going to need a shit load of permits for all the infectious diseases and imported biohazards.

Carl Drews · 1 October 2014

DS said: Ten plagues ride, man sign me up. That sounds like loads of fun! No wonder they expect so many visitors with attractions like that! Will ebola be the first or the last plague? Will the black death make the list, or will it be just the same old locust stuff? How about H1N1, aids and other favorites? Is it going to be updated every year or just biblical stuff? Man they are going to need a shit load of permits for all the infectious diseases and imported biohazards.

Don't go on the Tenth Plague Ride if you have a son. But the Hail Ride could be a hoot.

Henry J · 1 October 2014

Anyway, too bad they canât make it a non-prophet organization. Now that would be a dose of reality.

No, no, it's atheism that is the non-prophet group.

DavidK · 1 October 2014

Americans United doesn't think much of the whole scheme as well:
https://www.au.org/church-state/october-2014-church-state/featured/rough-sailing

stevaroni · 1 October 2014

DS said: Is it going to be updated every year or just biblical stuff?

I vote for The Plague of TV Pundits, The Plague of Idiot School Boards, Plague of Endless Mideast Wars and The Plague of Spine-Eating Bacteria (that last one seems to primarily affect politicians, which is weird since they have so little spine in the first place).

Scott F · 1 October 2014

DavidK said: Americans United doesn't think much of the whole scheme as well: https://www.au.org/church-state/october-2014-church-state/featured/rough-sailing

Interesting. According to the AU site, that would come to a tax subsidy of about $340,000 for each one of the 265 jobs, 218 of which would be part time. Kentucky would do better to simply hire the minimum wage employees directly.

Doc Bill · 1 October 2014

Scott F said:
DavidK said: Americans United doesn't think much of the whole scheme as well: https://www.au.org/church-state/october-2014-church-state/featured/rough-sailing
Interesting. According to the AU site, that would come to a tax subsidy of about $340,000 for each one of the 265 jobs, 218 of which would be part time. Kentucky would do better to simply hire the minimum wage employees directly.

So, they're creating 47 jobs, not hundreds. Probably just about covers Ham and his relatives.

Golfball · 2 October 2014

Just Bob said:
Henry J said: For some reason, this reminds me of Kent Hovind...
Hmm... now where is old Kent these days?

Enjoying the sun in Federal prison in Atlanta. He's scheduled to get out next August, I think that's because his sentence will be up. He's still got a s**tload of restitution to pay up, and Dinosaur Adventure Land was seized by Uncle Sam towards that end. (The property ol' Kent conveyed to his son is staying within the family, but the other 9 are now owned by Unca Sam or whomever Unca Sam sold them to.)

Charley Horse · 2 October 2014

Such a scheme allows for all kinds of mischief in the allocating of funds, expenditures, etc. Auditing
would be complicated. For several reasons. Which is often reason for such schemes.
AIG is presently using AIG resources such as office and warehouse space for a for profit business. Would it
surprise anyone that the funds designated for Ark Park are being used for paying for expenses that would otherwise
be paid for from the non-profit business?

Don't be surprised if the Ark Park ever opens that volunteers will be used just as they are at the Creation Museum.
Which means they would not have to pay payroll taxes or workmen's comp for those as long as it is never found out.

Bankruptcy is definitely a possibility for the Ark Park. That is when an owner knowing he is headed for bankruptcy
with one business the goal becomes to salvage all cash by moving into different accounts and hiding it as expenses, etc.
Another auditing complication...commingled accounts.

callahanpb · 2 October 2014

DS said: Ten plagues ride, man sign me up. That sounds like loads of fun!

Animatronic skinny cows that ate the fat cows would actually be pretty cool to see. Could also be the premise to a scary "Westworld" type thriller.

callahanpb · 2 October 2014

DS said: Can Ken Ham go to jail for tax fraud and attempted tax evasion? If so, would he share a cell with Kent Hovind?

Didn't Bob Marley have a song about this kind of oppression? "How long shall they tax our profits, while we stand around and look?" Or was that Jacob Marley?

harold · 3 October 2014

callahanpb said:
DS said: Can Ken Ham go to jail for tax fraud and attempted tax evasion? If so, would he share a cell with Kent Hovind?
Didn't Bob Marley have a song about this kind of oppression? "How long shall they tax our profits, while we stand around and look?" Or was that Jacob Marley?

I do feel the need to echo what Doc Bill said above. There's no such thing as a good authoritarian religious fanatic demanding political privileges for his personal sect. However, among those bad people, some are more egregious than others. Take a look at the Wikipedia page on Kent Hovind. Ken Ham is a far, far, far less blatant offender. He certainly stretches the meaning of "nonprofit", and I totally oppose tax exempt status for religious organizations. But the main problem here is the state of Kentucky. All they had to do was reject this project as unsuitable. I'm not defending Ken Ham here. Just noting that the situation is not perfectly analogous. There may be some legal sanctions in order, but I don't see a ten year prison sentence here.

EdHensley · 6 October 2014

UPDATE - New Kentucky Open Records Act documents show that on Aug 27, KY Tourism Cabinet expressed concern about the CAD position for Ark Encounter advertised on the AIG website. KY informed Ark Encounter they are not eligible for the tax rebates if they practice religious discrimination.

Ark Encounter replied on Aug 28 "By the terms of your letter you are adding requirements on Ark Encounter..." -- James Parsons (Ark Encounter) to Robert Stewart (KY). Ark Encounter has been arguing (sometimes through statements by The Center For Religious Expression and/or Freedom Guard) that due to Hobby Lobby, Greece v Galloway, and other decisions, Ark Encounter has the right to discriminate and that KY has no right to deny them access to the state program because that would be viewpoint discrimination.

Robert Stewart of KY replied on Sep 4, "The Commonwealth does not provide incentives to any company that discriminates on the basis of religion, and we will not make any exception for Ark Encounter, LLC."