http://www.politicsdaily.com/2010/08/13 ... urt-rules/

Congress Can Withhold Funds from ACORN, Federal Court Rules

Christopher Weber


Congress can continue to withhold federal money from ACORN following a federal appeals panel decision Friday that rejected a lower court's ruling about funding for the community activist group.
New York's 2nd Circuit Court of Appeals reversed a decision by a district court judge that found Congress had violated the controversial group's rights by punishing it without a trial, The Associated Press reported.

Federal funds for ACORN were cut off last year after the group was accused of violating the tax-exempt status of its affiliates with overt partisan politicking. ACORN also faced charges from conservative media of voter fraud after the 2008 election.

The organization also made headlines after a video surfaced of a sting by conservative activists showing low-level ACORN staffers giving tax advice for what turned out to be a fictitious prostitution ring.

ACORN had filed a lawsuit accusing Congress of abusing its power with what amounted to a "corporate death sentence," the AP said. The appeals court disagreed, pointing out that the group received only about 10 percent of its funding from the federal government.

"We doubt that the direct consequences of the appropriations laws temporarily precluding ACORN from federal funds were so disproportionately severe or so inappropriate as to constitute punishment," the three-judge panel wrote.

ACORN's attorneys said they were considering another appeal.

The Association of Community Organizations for Reform Now had described itself as an advocate for low-income and minority homebuyers. The national organization closed up shop earlier this year because of dwindling revenue, but some local affiliates are still active under various names.