Our Streets Minneapolis must register lobbyists

MINNEAPOLIS (FOX 9) - Our Streets Minneapolis, a bike and pedestrian advocacy group that puts on the popular Open Streets events, has run afoul of state lobbying rules. 

The Minnesota Campaign Finance Board disclosed Thursday a settlement agreement with Our Streets Minneapolis for failing since 2018 to register some of its employees as lobbyists.

As part of the settlement, five employees have now registered as lobbyists, Our Streets Minneapolis will register as a group that engages in lobbying and will pay a civil penalty of $4,000. 

The complaint was brought by Carol Becker, a former member of the Minneapolis Board of Estimate and Taxation, who told FOX 9 she believes the organization crosses the line from advocacy to lobbying.

"This is just one step in bringing accountability to a group that really hasn't been following the law and being ethical," said Becker.

Lobbying and nonprofits

Our Streets Minneapolis, formerly known as the Minneapolis Bike Coalition, is a 501(c)(3) nonprofit, and contributions to the organization are tax-exempt.   

According to guidance from the Internal Revenue Service (IRS), "A 501(c)(3) organization may engage in some lobbying, but too much lobbying activity risks loss of tax-exempt status." 

In her complaint, Becker said Our Streets records show $89,000 of their $500,000 budget went directly to lobbying. 

Bus Lanes, light rail, I-94 

Our Streets Minneapolis has advocated in recent years for 24/7 bus lanes on Hennepin Avenue, Minneapolis sidewalk clearing, expansion of the light rail’s Blue Line, and MNDOT’s Rethinking I-94 Project.  

In emails and social media campaigns, Our Streets has urged its supporters to contact the Minneapolis City Council, the Met Council, Hennepin County Board and MNDOT, regarding those issues. 

Becker said the group’s efforts generated tens of thousands of emails to politicians that go well beyond general advocacy for biking and healthy living. 

"When you say, ‘I want to turn Hennepin Avenue into one lane,’ that’s lobbying. That’s not just advocacy and that’s state law as well as just plain obvious logic," Becker said.

In response to Becker’s complaint with the Campaign Finance Board, Brian Dillon, an attorney for Our Streets, wrote the group "Now recognized that it recently began engaging in regulated lobbying activity without knowing that it had done so."

Dillon said while Our Streets "spent $125,607 on advocacy in 2021, the majority of those expenditures were to inform and educate the public on various issues and were unrelated to lobbying."  

Dillon claimed the group was simply encouraging members to "make their own voices heard." 

A total turnover

The Campaign Finance Board didn’t buy it.   

The Board said there was evidence Our Streets asked people to contact public officials and request specific official actions. 

The Board ordered a formal investigation of the group’s activities from 2018 through 2021, seeking specific information about finances and staffing.

But Dillon told the Campaign Finance Board there had been a total turnover of staff since 2018, making the information difficult to gather.

As a compromise, Our Streets agreed to a summary proceeding and settlement, rather than an investigation or audit.

"Our Streets is prepared to accept the conclusion that it inadvertently engaged in lobbying in years prior to 2022, and that it remains committed to complying with all applicable lobbying laws going forward," Dillon wrote to the board. 

City-supported fundraising? 

Becker said the lobbying issue is important given Our Streets cozy relationship with Minneapolis City Hall. Former Minneapolis Council President Lisa Bender was a co-founder of the group when it was known as the Minneapolis Bike Coalition. 

The city has a contract with Our Streets as the organizer for Open Streets Minneapolis, when busy thoroughfares like Lyndale Avenue South and Minnehaha Avenue are cordoned off for one Sunday in the summer, giving bicycles and pedestrians free-range.     

Our Streets uses the events as a fundraising opportunity and collects donations and fees from vendors. 

Last year, Our Streets Minneapolis asked the City of Minneapolis for a five-year contract that would pay the group $100,000 a year to organize Open Streets events. The group also wanted the city to pick-up $20,000 in in-kind contributions for sanitation, law enforcement, and street barricades. 

The City Council approved the selection of Our Streets last February as the organizer of Open Streets until 2024, with an option to extend the contract through 2026, but without any city money going directly to the group.     

Becker still has problems with the arrangement. 

"I don't understand how the city of Minneapolis is still giving them a contract (for Open Streets), which they use as a fundraiser, to raise money to be able to lobby the City of Minneapolis. That still has not been addressed," Becker said.  

A spokesperson for the City of Minneapolis confirmed it is seeking $3,850 reimbursement from Our Streets for "previously submitted ineligible expenses" but did not say what made the expenses ineligible. 

More to come? 

Becker doesn’t believe the group’s troubles are quite over.  She said foundations that have contributed money to Our Streets have specific rules against money being used for lobbying.   

While some interest and advocacy groups have separate non-profit and lobbying arms, that can also affect the tax status of contributions. 

"Because this group isn't just out there saying biking is a good thing. They're out there lobbying government for specific changes. That's how you get 44,000 emails on one issue," Becker said. 

Open Streets Minneapolis did not respond to a request for comment.