Calif. Rep. T.J. Cox Wants ‘Thank You’ For Nonprofit Hit By Scathing Audit

Alludes to 'agenda' of paper questioning his businesses, taxes, and disclosures

Rep. T.J. Cox / T.J. Cox for Congress

California Democratic representative T.J. Cox broke several weeks of silence on an audit from February that blasted a nonprofit for which he served as treasurer, with the congressman seemingly irritated when suggesting there's been a lack of gratitude for what the nonprofit has done.

Cox's victory last November over incumbent Republican Rep. David Valadao wasn't decided until weeks after Election Day, and was won by less than a thousand votes, suggesting his hold on the seat is likely tenuous in a district in California's San Joaquin Valley.

An interview on local television station KSEE that aired over the weekend comes as the largest paper in his congressional district has published a string of articles raising questions about some of the congressman's business dealings, taxes, and financial disclosures.

The latest of those articles, published early Tuesday morning by the McClatchy-owned Fresno Bee, said Cox "has a complicated financial history that includes multiple tax liens and a delinquent debt that caused the Fresno County Sheriff's Office to warn him that it could seize his property."

The nonprofit under scrutiny, the Central Valley Community Sports Foundation (CVCSF) was begun in 2015 by local developer Terance Frazier, primarily to run a city sports park that has had a troubled history. Cox was the foundation's treasurer from its inception.

Under the arrangement between the CVCSF and the city, the nonprofit pledged $2.7 million in upgrades to the outdoor sports park and would take over the yearly management. The city would pay the CVCSF $150,000 per year for the management, slightly less than what the government had been allocating in their own budget.

However, last August, Frazier approached the city to increase its financial contribution, which then triggered a clause in the contract allowing the city to perform an audit, and a Bee article shortly after raised questions about how much investment had actually occurred.

"During the initial review, Internal Audit determined that CVCSF's internal controls were deficient to nonexistent," one of the findings read. Other conclusions by the audit team found the nonprofit's checkbook was not balanced correctly, contracts were sometimes made verbally, and multiple payments had been made to "corporate officers" of the nonprofit that were questionable.

"In February 2017, two Corporate Officers of CVCSF withdrew $145,140.76 and $75,000 respectively as ‘loan repayments,'" it noted. "However, these withdrawals were made before there was evidence that the individuals had provided any such loans to the non-profit."

It's not clear if Cox was one of the corporate officers mentioned.

Cox had not provided substantive comment about the audit to media requests from multiple outlets including the Washington Free Beacon, but finally addressed the issues with KSEE in an interview that aired Sunday.

"There's a—to a certain extent—no good deed goes unpunished," Cox began. "You know, that was a site, as you know, I mean it was 20 acres of wheat. It was a public nuisance. It was a homeless encampment. Right? And Terance came along with assistance from me, and they turned it into this public recreational facility, at no risk to the city, no cost to the city, right? Less than they were spending before. That's being used by thousands of people every day, right?"

"I kind of just wish that they would just say ‘Thank you so much for what you've done,' right, to make this available to the city."

For more than six weeks, the Washington Free Beacon has made several unsuccessful attempts to obtain a copy of the 2017 IRS 990 form for the CVCSF, a document that is essentially the tax return for the nonprofit and supposed to be available by law.

A document from March shows the congressman severed his ties with the CVCSF that month, and the Fresno County district attorney's office has launched an investigation into the audit as well.

Two weeks ago, the Fresno Bee published a story noting that Cox "failed to disclose several business interests during his most recent congressional candidacies, including the fact that he sits on the board of a for-profit Canadian mining company[.]"

Cox complained to KSEE that the Bee's reporting omitted information, but his response was also less than straightforward.

"What they forgot to tell you is, any of these things—and there wasn't any of them where—one, they were already shut down, had no assets or revenues.  That's uh, that would've been a very pertinent piece of information."

Cox's congressional office did not respond to requests by the Beacon for a clarification on those remarks.

The same report also raised questions about whether he had disclosed possible rental income on a home in Fresno, and the congressman's office did not respond to the Bee's questions on those issues.

In the KSEE interview, Cox indicated he thought the article was implying that he had skirted disclosure laws, and called it "inaccurate."

"If a news organization has some kind of agenda, I can't worry about that," he said.

The most recent report by the Bee, which came after the television interview, breaks new ground on other business dealings already receiving scrutiny.

"Some of his financial entanglements were reported during his 2018 congressional campaign, including an IRS lien against him and his wife," the report said. "McClatchy has obtained new records showing that the Fresno County Sheriff's Office was involved in collecting an arbitration payment five years ago, as well as recent liens against two of his companies."

Cox's office did not respond to a request for comment on the newest article by the Bee.

When asked about the disclosure issues, the audit, and whether the congressman provided information to the Bee on stories he claims omitted key information, Cox's office only response was to point to an article also in the Bee. That report noted the Fresno city attorney said the CVCSF was continuing to meet its contractual obligations to the city.

His 2018 campaign was based in large part on promoting a track record of business success. He has also been a vocal supporter of legislation introduced by the newly Democrat-controlled House that seeks to ratchet up financial disclosure laws for members of congress and candidates.