Gov. Shapiro takes $12K in sports tickets from secretive nonprofit

(Editor”s Note: Spotlight PA is an independent, nonpartisan, and nonprofit newsroom producing investigative and public-service journalism that holds power to account and drives positive change in Pennsylvania.)

HARRISBURG — A nonprofit that does not publicly disclose its donors paid more than $12,000 last year for Gov. Josh Shapiro to attend sporting events. The secrecy leaves taxpayers in the dark about who underwrites the outings and what interests they may have in state government policy.

The money also raises questions anew about whether the Democrat is violating his ban on accepting gifts.

Shapiro reported receiving $12,194.62 from Team PA for “transportation, lodging or hospitality” on his newly filed statement of financial interest. The Harrisburg-based nonprofit bills itself as a public-private partnership to bolster Pennsylvania’s economic development; its “investors” include a cross-section of the state’s top business industries, according to an annual report.

On the form, Shapiro did not describe what Team PA paid for, writing only: “The governor in his official capacity attended various events for the benefit of the Commonwealth to promote Pennsylvania and its economic interests.”

In an email, Shapiro spokesperson Manuel Bonder said Team PA paid for the Democratic governor to attend six sporting events: the 2023 Super Bowl in Arizona and games played by the Harrisburg Senators, Penn State’s football team, Philadelphia Phillies, and Philadelphia Union.

Bonder added that Shapiro was often invited to these games by the teams, and used the time to greet fans, cheer the teams on, and network with business or legislative leaders also in attendance.

The money for those tickets came from a little-known fund that Team PA manages called Pennsylvania Growth Partnership, which accepts donations exclusively to promote the governor — and by extension, the commonwealth and its economic health — on a national and international stage.

It’s not publicly known which individuals, groups, or businesses have donated to the growth partnership fund. Nonprofits are required to file detailed annual reports to the Internal Revenue Service that list, among other things, revenue and expense totals. But they aren’t required to make the names of their donors public.

Bonder deferred to Team PA, whose executive director, Abby Smith, has declined to identify the fund’s donors.

Despite IRS rules, one good-government expert said “it would be very reasonable” to ask Team PA to disclose the donors to the growth partnership fund, given its specialized purpose to pay for the governor’s travel.

“The nonprofit is just serving as a go-between,” Craig Holman, a government ethics expert with the Washington, D.C.-based Public Citizen, told Spotlight PA, adding: “If those funds are being earmarked specifically as gifts to the governor, then each donor needs to be publicly disclosed.”

It is also not clear who raises money for the growth partnership fund, or who decides which events Shapiro attends on Team PA’s dime.

In a previous interview, Smith said when the nonprofit gets requests to use money from the various funds Team PA manages, it approves them and cuts a check.

Asked again this week to provide more specifics, Smith replied: “When an opportunity arises at which the Governor’s attendance will shine a spotlight on the Commonwealth and/or position the Governor as a leader in attracting and retaining business, the Governor’s Office works with Team PA and the Pennsylvania Growth Partnership fund is used to support the Governor’s attendance.”

Bonder said that the governor’s office “does not have sole discretion over this funding” and that Team PA “must grant approval for all funds disbursed from its account.”

Shapiro’s gift ban

Under Pennsylvania law, public officials are allowed to accept gifts, lodging, hospitality, and transportation of any value. They must disclose gifts over $250 and lodging, hospitality, and transportation worth more than $650 on their statements of financial interests, which are due by May 1 of every year.

But like his predecessor, Democratic Gov. Tom Wolf, Shapiro decided to restrict the kinds of gifts he and other administration employees can accept.

Shortly after taking office in January of last year, Shapiro signed an executive order that bars administration executives, employees, and appointees from accepting cash or anything of cash value from people or entities that do or want to do business with the state.

Though the order was less restrictive than the ban imposed by Wolf, it laid out a wide swath of gifts or other items that are prohibited. “Admission to a recreational event” — which includes a professional or semi-professional sports event — is among them.

Bonder said the administration consulted the state Ethics Commission before filing Shapiro’s statement of financial interest. The commission, he said, “affirmed that these items are classified as hospitality.”

The statements of financial interest contain separate areas for officials to enter gifts and transportation, lodging, and hospitality. The commission uses definitions from the state’s lobbying disclosure law, which calls a gift, “Anything which is received without consideration of equal or greater value,” and hospitality as including “meals, beverages, and recreation and entertainment.”

However, Holman, the ethics expert, said the sports tickets are “a flat-out gift to the governor.”

“There’s no ifs, ands, or buts around it,” he said.

From the start, Shapiro has faced questions about whether the sporting event tickets from Team PA violate the ban.

The administration previously argued that the gift ban was not designed to cover Team PA, which a spokesperson described as “completely incomparable to a private actor.” At the time, the administration said it would continue to accept money from the organization, which just last year was awarded nearly $1.8 million in state contracts.

“The precedent of Team Pennsylvania supporting the Governor in economic development work has been set through several prior Administrations,” Bonder said this week.

Who foots the bill?

In a wide-ranging interview in February, Smith said Team PA has a long history of working with Pennsylvania’s governors to promote the state’s economy and business interests.

Founded in 1997 as the brainchild of former Republican Gov. Tom Ridge, Team PA brings together government, higher education, and business leaders to identify or expand economic opportunities.

The organization, co-chaired by the governor in office and a private sector representative, is organized as a nonprofit under the federal tax code, and is funded by private donors whose names are not publicly disclosed. Nonprofits are not required to make donor information public, although they could in the name of transparency.

Prior governors have tapped the organization for money over the years, including Republican Tom Corbett, who used Team PA to pay for trade missions to countries including Brazil, Chile, and Germany. (Ridge and former Ed Rendell, a Democrat, also led overseas trade missions, but paid for them with taxpayer dollars).

Over the past decade, the financial ties between the government and Team PA have increased — in part, ironically, because of a strict gift ban imposed by Wolf.

Under that policy, administration officials could not accept even a disposable bottle of water, unless they planned to reimburse the cost.

Given those restrictions, several commissions under the governor’s jurisdiction, such as the Governor’s Advisory Commission on Women, could no longer solicit or receive private donations to fund their activities. So they approached Team PA to act as a “fiscal agent” for their fundraising efforts, Smith said, “because we already had a precedent of being a fiscal home” for groups connected to the commonwealth.

At the time, said Smith, Team PA acted as a fiscal agent for a handful of monetary funds associated with the governor’s office, including the bank account that funds renovations of the governor’s residence.

Under Wolf and his strict gift ban, that list expanded. The nonprofit now is the fiscal agent for eight funds bankrolled by private donors — whose names are not publicly disclosed — that benefit the governor or commissions associated with the administration, according to Team PA’s website.

But exactly who raises money for those funds is a mystery.

Smith said the nonprofit is not responsible for fundraising for those pots of money, but she also has not replied to requests for information about who is.

Anne Wakabayashi chaired the Governor’s Advisory Commission on LGBTQ Affairs during Wolf’s tenure. The commission is one for which Team PA is a fiscal agent.

Wakabayashi told Spotlight PA that she never used the account.

“The process of fundraising into Team PA’s bank account for the commission was so opaque and never fully laid out, it was easier to pay for costs, like lunch or small needs, out of pocket,” she told Spotlight PA.

Unlike donations to an elected official’s political action committee, donations to funds managed by a nonprofit like Team PA lack the kind of transparency that good-government groups say is necessary for the public to understand who is supporting — or trying to influence — public policy.

Campaign reports, for instance, list not just a donor’s name, but how much money they gave and when.

Asked if a nonprofit’s opaque finances allow private interests to attempt to influence a public official without worrying about transparency, Smith responded: “They’d be a heck of a lot more effective if they did that into the PAC.”