Warnock Fundraises With Steyer After Voting for Legislation That Poured Billions Into Green Energy
Events come amid global surge in energy prices as Democrats vilify fossil fuels
Sen. Raphael Warnock (D., Ga.) raked in cash from wealthy green energy moguls at a series of San Francisco fundraisers last weekend, a month after voting to pass legislation that steered billions to climate initiatives and the green energy industry.
During his West Coast fundraising swing, the senator partied with billionaire investor Tom Steyer, biofuels CEO Wade Randlett, and "Defund the Police" advocate Meena Harris, the niece of Vice President Kamala Harris, according to photos. Steyer cohosted an event for Warnock in San Francisco on Saturday, along with NextGen America board member Andrea Evans, according to an invitation for the fundraiser. Randlett cohosted an event for Warnock on Friday.
The parties came weeks after Warnock voted for the Biden administration’s budget reconciliation bill—officially dubbed the Inflation Reduction Act—and highlight the cozy relationship between Democratic political leaders and the lucrative green tech industry. The legislation poured billions into green energy initiatives and is expected to benefit industries in which Steyer is an investor, according to analysts. The fundraisers also come amid a global surge in energy prices, with many Americans struggling to pay utility bills, and as Democratic lawmakers continue to vilify the fossil fuel industry.
Steyer, a Democratic donor who ran a short-lived campaign for president in 2020, launched a "climate investment fund" called Galvanize in 2021 with a goal of investing "billions" into decarbonization companies. The fund’s reported investments include Regrow Ag, a startup that "aims to help accelerate the shift to climate-friendly farming" and Arable, which seeks to "create a more sustainable food supply."
Both Regrow Ag and Arable were named as companies that are likely to benefit from a $20 billion earmark in the federal spending bill, according to an analysis published by the clean energy investment firm G2 Venture Partners on Aug. 17, the day after the bill was signed by President Joe Biden.
The bill "has earmarked $20B to (1) target methane and nitrous oxide emission reduction (e.g. Arable, Trace Genomics), (2) improve soil carbon and nitrogen content (e.g. Pivot Bio), and (3) avoiding / sequestering GHG emission (e.g. ProducePay, Regrow, Cloud Agronomics)," wrote G2 Venture Partners.
Steyer praised the passage of the bill as the "culmination of a decade of advocacy and persistence." Earlier this month, he attended a party at the White House celebrating the legislation.
The Friday fundraiser was cosponsored by Randlett, a biofuels mogul and CEO of the transportation fuels division at General Biofuels. The spending bill extended the biodiesel tax credit and was praised by leaders in the biofuels industry.
"This bill represents the most significant federal commitment to low-carbon biofuels since the Renewable Fuel Standard was expanded by Congress in 2007," said Renewable Fuels Association president Geoff Cooper in a statement applauding the bill.
Andrea Evans, a board member at Steyer’s nonprofit group NextGen, also cohosted the Saturday Warnock fundraising event.
The Inflation Reduction Act has faced some criticism, with Republicans arguing that it will raise taxes while steering federal funds to Democratic constituencies. Warnock praised the bill, saying it will "help lower costs for families in every corner of our state—all without raising taxes for hardworking Georgia families. That’s a win-win."
Photos from Warnock’s California fundraising trip also show him posing with his arm around Meena Harris, an Instagram lifestyle influencer and the niece of Kamala Harris. Meena Harris is a vocal advocate for the "defund the police" movement.
"Defund the police and reallocate funds to mental health and social services. This shouldn’t be controversial," wrote Harris in one Twitter post.
She later expanded on this by adding: "To everyone in my mentions policing my language, let me clarify: Defund the police. Defund the police. Defund the police. Defund the police. Defund the police. Defund the police. Defund the police. Defund the police. Defund the police. Defund the police. Defund the police."
The senator is the party’s top fundraiser for the midterm cycle, pulling in a whopping $17 million last quarter in his competitive faceoff against Republican challenger Herschel Walker.
Published under: Georgia, Raphael Warnock, Tom Steyer
How Raphael Warnock Dodges Income Taxes
Warnock doesn't pay income taxes on a $90K ‘parsonage allowance’ from Atlanta church
Sen. Raphael Warnock (D., Ga.) has an unusual financial arrangement with an outside employer that allowed him to avoid income taxes on $89,000 in outside salary last year, according to tax experts.
Warnock, who works as the senior pastor at Ebenezer Baptist Church in Atlanta, said the church paid him $89,000 last year as a "parsonage allowance"—as opposed to regular outside income, which is subject to strict limitations for senators under federal law. Lawmakers are not allowed to receive more than $29,895 in outside income.
The news raises questions about whether Warnock is taking a tax break that’s unavailable to the vast majority of Americans. Republicans say Warnock wants to raise taxes, pointing to his vote for a spending package in August that some analysts claim would increase taxes on low- and middle-income earners. The senator has also faced criticism for his outside financial arrangements from his opponent, Republican Herschel Walker. The Walker campaign has slammed Warnock for doubling his annual salary since taking office, raking in $120,000 from the Ebenezer Baptist Church and over $240,000 for a book deal.
Tax experts said the Internal Revenue Service created the modern "parsonage allowance" provision in the 1950s as a tax break for religious leaders, who historically lived in tax-exempt church-owned parsonages but now often rent or own their own homes. The provision allows pastors and other clergy members to deduct their estimated annual housing expenses—including mortgage payments, lawn care, furniture, and pool maintenance—from their income taxes.
Warnock’s campaign declined to comment on whether he paid income taxes on his housing allowance.
Some legal experts also questioned the Senate Ethics Committee’s decision to approve the arrangement, saying it appears to violate federal law that prohibits members of Congress from receiving more than $29,895 in outside income. Warnock’s campaign suggested that the "parsonage allowance" wasn’t subject to the same cap as regular income, according to the Atlanta Journal-Constitution, which first reported on the arrangement last month.
"Sen. Warnock's arrangement appears to be an abuse of both the parsonage allowance provisions of the tax code and Senate ethics rules," Charlie Spies, a Republican campaign finance attorney with Dickinson Wright, told the Washington Free Beacon. "The parsonage exception in Sec. 107(2) is targeted for those who are pastors, not boondoggles for politicians."
Tax experts told the Free Beacon qualified clergy members are allowed to designate up to 100 percent of their salaries as tax-free under the parsonage exemption. Although clergy members need written acknowledgment from their church to participate, religious institutions have no say over the percentage the clergy requests and don’t provide oversight into how the employee spends this money, according to experts. Instead, participating clergy members are supposed to be regulated by the IRS.
While many pastors claim less than 40 percent of their salary as a parsonage allowance, one forensic accountant said he has seen some who take upwards of 70 or 80 percent—an amount he said was "bordering on abusive."
Warnock’s parsonage allowance adds up to nearly 75 percent of his income from the Ebenezer Baptist Church, which breaks down to about $7,400-per-month in housing expenses.
The senator owns a home in Atlanta that was recently appraised at around $1 million, according to property records. In addition to mortgage payments, the parsonage allowance can be used to cover any housing-related costs, including security, landscaping, and home furnishings.
Gil Rothenberg, the former chief of the Department of Justice tax division’s appellate section, told the Free Beacon the parsonage allowance was intended to "even the scales" between wealthy churches and poorer ones, which can’t always afford to provide a well-maintained home for their ministers.
But he said there have also been past cases where religious leaders have abused the system. In 2002, Rothenberg represented the government in a legal dispute with Rick Warren, a megachurch pastor who had claimed $80,000 of his salary as a "parsonage allowance"—an amount that the IRS claimed exceeded the value of his housing. The case prompted Congress to update the law, capping the parsonage allowance at the fair rental value of the home, plus furnishings and maintenance.
"The kinds of cases that got to me when I was at DOJ were basically the really abusive ones," said Rothenberg. "I don’t know how many other ministers are basically padding their parsonage allowance. Nobody knows. You hope that the CPA, or whoever is doing their taxes, is doing it correctly."
While churches note that the provision is crucial for many clergy members, who often don’t earn large salaries, the rule has also been controversial. Critics have accused some clergy members of taking advantage of the exemption, using it to pay for lavish vacation homes and other luxuries.
Peter Reilly, a certified public accountant who has written about parsonage allowances, said Warnock’s allowance "seems like a lot, but it’s not crazy" in comparison with others he has seen.
"Some of the parsonage [allowances] can tend to be enormous," he told the Free Beacon. "Some of the televangelists, it’s millions."
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