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Star Ohio tax witness paid $150K a year by trust

Julie Carr Smyth, AP Statehouse Correspondent

COLUMBUS, Ohio (AP) -- An Ohio Statehouse witness on tax and economic issues who's relied upon for his objectivity draws a hefty stipend from a conservative trust fund, an Associated Press review has found.

Retired Ohio University economics professor Richard Vedder has been paid a $150,000 annual consulting fee through the Alexandria, Va.-based Donors Trust, which supports free-market nonprofits focused on shrinking the role of government.

Business and payroll records reviewed by the AP suggest Vedder draws only a fraction of his income from the university with which he's most commonly associated as he offers economic assessments on bills including the Ohio budget. Vedder hasn't been on the university's regular payroll since 2001.

He was a star witness on tax code changes proposed by Republican Gov. John Kasich, and his research was cited again by backers of right-to-work legislation introduced last week.

Donors Trust, which distributes about $30 million a year to its chosen causes, paid Vedder in 2009, 2010 and 2011, according to its most recent business filings. The trust fund's benefactors aren't public. The fund's chief financial officer said Vedder continues to be paid through a recently created subsidiary nonprofit, Project Liberty.

Donors Trust's stated mission is supporting charities that alleviate society's most pressing needs by encouraging "private philanthropy and individual giving and responsibility as an answer to society's needs, as opposed to government involvement."

Among its dozens of beneficiaries are universities and think tanks including the Cato Institute, Freedom Works, Americans for Prosperity and the American Legislative Exchange Council.

Vedder said his affiliation with the organization hasn't prevented him from presenting dispassionate testimony. Among Ohio's most distinguished economists, he has been called upon to advise world leaders including Margaret Thatcher, Vladimir Putin and Benjamin Netanyahu on fiscal and economic policy.

"I do have sort of a free-market perspective, a not-doctrinaire free-market perspective," Vedder said in a telephone interview. "I do think there's a role for government and all."

Vedder said Donors Trust handles payroll, clerical and legal assistance for a handful of small nonprofits it supports, including the Center for College Affordability and Productivity, where he serves as director. He said the center emphasizes "non-governmental alternatives" in higher education.

Vedder acknowledged that Kasich is pleased with the economist's support for his economic policies and budget proposals, as evidenced by the governor's office distributing and promoting Vedder's complimentary assessments. "But I'm not an employee of the governor and no one in his office tells me what to say, and certainly no one at Donors Trust tells me what to say," he said.

A spokesman for Kasich said he was unaware of Vedder's affiliation with the trust.

Vedder charmed state lawmakers with his tax testimony in the House this spring, providing eloquent, humor-injected commentary during an hour of questioning. He told the House Finance Committee that Kasich had encouraged him off the sidelines with his views on the administration's sweeping tax overhaul, much of which the House ultimately rejected.

He was identified that day as an Ohio University economics professor — with the "emeritus" absent from his title — as he is on the website for the Washington, D.C.-based Center for College Affordability. Vedder said he still teaches at least one course a year at the university, though he's technically retired.

"When Democrats and liberals call me up and ask for my help, I help them too," he said. "I'm a college professor. I'm just trying to help the debate along. I'm not representing OU, I'm not representing Donors Trust, I'm not even in this capacity representing the Center for College Affordability and Productivity. I'm really representing myself."