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Gent lemen;We nave cons idered your a p p l i c a t i o n fo r r ecogn i t i onof exemption under seot ion 501(0) (3 ) o f the In t e rna l Rev-enue Code and have determined t h a t you do not qua l i fyunder t h a t se c t i o n . Our reasons fo r t h i s conc lus ion and.the f a c ~ s upon which it i s based are expla ined in d e t a i lbelow.The evidence pre sen ted d i s c l os e s t h a t you were i nc o r -pora ted on Apr i l 1 , 197:3. under the Genera l Nonprof i t Cor -pora t ion Law' of the Sta te of C a l i f o r n i a . As s t a t ed in anamendment to your A r t i o l e of Inco rpora t ion , your spec i f i c

and pr imary purpose i s to ad.vance the wel f a r e of the homo-sexua l community through educat . ional a c t i v i t i e s and l e g a la c t i c n .In fUr therance of t h i s purpose, you engage in thefo l lowing a c t i v i t i e s :

1 . You a s s i s t the Ci ty of San Franoiscoin enfo rc ing a c i t y ordinance p r o -h ib i t i ng employment d. l sor imlna t ionon the b a s i s of sexua l or i e n t a t i onby con t r ac to r s with the c i t y . In t h i sreRard . you promote the awareness ofthe ord inance among th e p u b l i c . Ina d d i t i o n , you provide l e g a l and o the ra s s i s t a n c e to parsol l .S a g a i n s t \\rhOtt\c i t y con t r ac to r s have a ~ l e ~ e d l y d i s ~ orlminated on the b a ~ i s of sexua lor i e n t a t i on . Fur the r . vou f i l e com_p la in t s on your own i ~ i t i a t i v e con_ca rn in e i n s t a n c e s o f d ~ s c r ~ m i n a t i Q n under the o rd inanca .

2/5 * CVD Ai 112612010 3:33:18 PM [Eastern Standard iimej * VR:DC FAXOlf3 DNIS:9515 *CSiD:202 707 7791 DURAiiON (mm,ss):0214

PX2581

8/9/2019 PX2581

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01/26/2010 14:40 PA.,'\. 202 707 7791 LOC )ISS Reading Room 141 002

," : .. ,.;':.:.,'':;!J!. >. " . ' . ', J ". ."> .~ ~ l { ~ > ~ } ~ . l ; ~ ~ \ " .. ;

PhonePbone/ ' " 1 ~ .............__ .... ..... V ~ l l , ' I ; " \ ' l . i ... .Number:

" . -:.. \ I ~ . : " ' ~ i - : i " : . . j { . J ' ~ '" :;jLJ Lli i _"

111 ~ : " " . ~ : /!II 1'.1

"

T : M S ; E O ! R ~ 2 ....,6

D n n ........... ., OR. '1... , . . . . . LJu .... . L . / .....S ~ n F r f i n C ~ ~ C O t C a l i o r n i ~

Gent lemen;We nave cons idered your a p p l i c a t i o n fo r r ecogn i t i onof exemption under seot ion 501(0) (3 ) o f the In t e rna l Rev-enue Code and have determined t h a t you do not qua l i fyunder t h a t se c t i o n . Our reasons fo r t h i s conc lus ion and.the f a c ~ s upon which it i s based are expla ined in d e t a i lbelow.The evidence pre sen ted d i s c l os e s t h a t you were i nc o r -pora ted on Apr i l 1 , 197:3. under the Genera l Nonprof i t Cor -pora t ion Law' of the Sta te of C a l i f o r n i a . As s t a t ed in anamendment to your A r t i o l e of Inco rpora t ion , your spec i f i c

and pr imary purpose i s to ad.vance the wel f a r e of the homo-sexua l community through educat . ional a c t i v i t i e s and l e g a la c t i c n .In fUr therance of t h i s purpose, you engage in thefo l lowing a c t i v i t i e s :

1 . You a s s i s t the Ci ty of San Franoiscoin enfo rc ing a c i t y ordinance p r o -h ib i t i ng employment d. l sor imlna t ionon the b a s i s of sexua l or i e n t a t i onby con t r ac to r s with the c i t y . In t h i sreRard . you promote the awareness ofthe ord inance among th e p u b l i c . Ina d d i t i o n , you provide l e g a l and o the ra s s i s t a n c e to parsol l .S a g a i n s t \\rhOtt\c i t y con t r ac to r s have a ~ l e ~ e d l y d i s ~ orlminated on the b a ~ i s of sexua lor i e n t a t i on . Fur the r . vou f i l e com_p la in t s on your own i ~ i t i a t i v e con_ca rn in e i n s t a n c e s o f d ~ s c r ~ m i n a t i Q n under the o rd inanca .

2/5 * CVD Ai 112612010 3:33:18 PM [Eastern Standard iimej * VR:DC FAXOlf3 DNIS:9515 *CSiD:202 707 7791 DURAiiON (mm,ss):0214

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' .

- 3"The Prid.e Ji'Ot..111d,ation

8 . ~ : : t n a . l l . . Y J you c:uud.uut a f'und r a i s i n g v;: \rictyshow open to the p u b l i c , :for the purposeo f .ra i s ing money to be used e x c l u s i v e l yin fur therance o f your o t h e r a c t i v i t i e s ~

Further, you have ind. icated, that you d.o n ot ad.vocateany particula:t;' phi loaophy, nor do you. advocate e i t he rh o m o s e x t ~ a l i t y oX" h e t e r o s e x u a l i t y as a preferred s e x u a lorientation or l i f e s ty le . IIowever, you adhere to thep r i n c i p l e t h a t all p e r s o n s a re ent i t l ed , to pursue t h e i rp r iv a t e and s o o ~ a l l i v e s without d i 5 0 r i ~ i n a t i o n i r r e 5 p e o ~ t i v e of' t h e i r sexua l o r i e n t a t i o n . l:n t h i s r e g a r d , youhave i n d i c a t e d t h a t your s e r v i c e s are a v a i l a b l e to anyperson , r ega rd less o f sexua l or ienta t io :n . who has beend i s c r i m i n a t e d a g a i n s t

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4-The Pride Foundat ion

I The Suprema C o u r t h ~ s oon t i nued to char:;uJti9r:U7,p.\ homosexual a c t i v i t y pe rve r ted Or d e v i a t e b eh av io r ,\ t h e e x p l i c i t ! ' e p r e s e n t a t i o n o r descl" ' ip t ion o f which\has been repea ted, ly held to be' p a t e n ~ l y of fens ive fo rLht1 p u r p u s e (",f m e e t i n g of : t h o c s t a b l i lS h e d . tests of'o b s cen i ty 50 as to fall ou t s ide th e pro tec t ion of" theFirst and. Four- teenth Amendments '!::;O th e U.S . C o n s t i t u t i o n "S ee : Y 1 i ~ h k i n v. N 0 w ~ Y o r k , 3 8J U,.S .502 (1966) ; } 1 i l l e r V"C a l i f o : r n i a , 413 u.s. 15 (1973) and Ha m l in g v. Uni ted . S t : : ~ t ! . ~ ~U.S. Law Week 5035 (June 24, 1 9 7 4 ) ~

The m a l a d & p ~ i v ~ and. at: l e a s t p o t e n t i a l l y o f f e n s i v ena tu re OL n o m O ~ ~ X U ~ L a c t i v i t i e s i s borne uut by th e c c n ~ t : inuing p r o h i b i t i o n of' s u b s t a n t i a l l y all form of sodomy\ by the c r im in a l l a ~ ~ o f most s t a t e s , ~ n o l u d i n g O a l i f o r n i a .a d d i t i o n , c e r t a i n of your a c t ~ v i t i s , s p e c i f i c a l l yyour d i n n e r j l e c t u r 0 s and. fund r a i s i n g show a re conductedi n a f o r m a t w'1-1.1c1:1 e n c o u r a g e s o r facilitates homos exua l

p r a c t . i G e ~ tv d s u b s t a n t i a l d e g r e e . Thi s is .$0 b e o a u s eth e s o c i ~ l as p ec t s of t h e s e a c t i v i t i e s migh t r e a d i l ycon t r ibu te t o inc rea sed p e r s o n a l r e l a t i o n s h i p s amonghomosexual ind . iv idual$o In. view of the genera l .::itatutorycond.emnat ion o f ' h o m o ~ e x u ~ l f . I . r ' a ( ; t : i c e ~ in CalifoTl1ia . t he s eprogl 'ams may, t h e r e f o r e , encourage and f a c i l i t a t e i l l e g a la c t i v i t y .

Based on t h e fo reg o in g , We f e e l t h a t your a c t i v i t i e sf a r e a d v a n c i n g th e u n q u a l i f i e d and u n r e s t r i c t e d pronlOt ion'{ of' th e a l l e g e d norma lcy o f homosexua l i t y . . Thus , we c o n -f. c i u d e t h a t your activities ca.r ry a l i ,eriowE :r';i..sk o i ~ Co h t r i bu t l ng to a more widespread development of homosexualt en d en c i e s among c e r t a i n segments of the p u b l i c and ac o n s e q u e n t i n c r e a s e i n th e g e n e r a l p r e v a l e n c e o f t ~ ' h a t i s $till g e n e r a l l y regarded as d ev ian t s ex u a l behav ior . ----- ... . _.lA s such your a c t i v i t i e s a re c o n t r a r ! to PUDl l C p O l l e yI and are t h e r e f o r e ~ n ot " c h a r 1 t a b l e . "

5/5 RCVD Ai 1126/2010 3:33:18 FM [Eastern Standaiu ilmej * VR:DC FAXOH3 *DNIS:9515 *CSID:202 707 7791 *DURAilOn (mm,ss):0214

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.... 5 -Th e Pl;ide li'ounda.tion

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1,_ _ In aqCl l t l .On , your a . c t i v i t i e s are. not "educa t i ona l t,I ~ ~ o ~ ; : , g e t ~ J : : ~ aI' ' ' det r1 lnen ta l , r a th e r 'chan benef ic ' i a lt t . [ J loue PU01 . 1C .I The f a c t t h a t some of your a c t i v i t i e s , a r e di rec t ed',tow'ai'u e l i i l l inat ion ot ' unjus t i f i ed . an d improper dj,$crimi ...' ,nat ion or t r ea t men t , or tow'ard v io la t ions of the pr1vacyl iof adu l t indivi .dua.ls , is i n s i gn i f i ca .n t when compared to~ t h e pos s ib l e de t r iment to socj .e ty .

Since your opel"ations ar.e n e i ' ~ h e r " ch a r i t ab l e " nor~ e d u c a t i o n a l n we conclude t h a t you do n ot q u a l i f y fo re:>:emption und.er sec t ion 501(c) (3 ) of the In t e rn a l Revel1'-'BCod.e.

lou a re r eq u i r ed to f i l e Fed era l income tax r e t u rn s .A LSO , con t r ibu t ions to you a re no t deduct ib le under sec -t ion 170 of' the Code.

You have the r i g h t to p r o t e s t t l t i s r u l i n g if youbel1eve t h a t it i s i n c o r re c t . To pr()'!;est you shoUldsubmi t a s ta tement c f your views, \ ~ i tb a f u l l ex p lan a -t ion o f your reasoning_ This s t a t ement must be sub-mitted, in d,upl ica te with in 21 d:ays frOID today , and mustbe s igned by one of' your p r i n c i p a l of ' : f icers. You a lsohave a r i g h t to confe rence in t h i s of;fice a f t e r yours t a t ement i s submitted. . you want a oonference , youm u s t r eque s t it \\"hen you file your p;r(ltet!t s ta te lnent .If you are to be r e p ~ 8 s e n t e d bv aomeone wh o i s not oneo f your pr in c ipa l o f f i c e r s he ~ u s t file a proper powerof" atto:t'ney. an d otherwiso qua. l i fy under au!' conferenceand p r ac t i c e reqUirelnQnts .

I f we do not hear f'T'om you within 21. days , th i sru l ing w'i l l become f i n a l and cop i e s t ~ " i l l be f o rwardedto th e D i s t l ' i c t Direc t or wih.ich i s YCl.-:r- key d i s t r i c t fo rexempt organiza t ion m a t t B r 9 ~ Al s c , the appropr ia te Sta t eo f f i c i a l s ~ i l 1 be no t i f i e d o f t h i s act ion in accordancewi th sec t i o n 61041c) of th e C D d . ~

S incere ly yours ,

D. CulemanChief , Rul ings Sect ion 2Exempt urganizat io l l$ Bran. ell

; V 1 " 1 ~ 1 ~ t I"I.lllt''1 t 'l lU t 1'\l'\.11"I. t'jt'l" '711'7 ""1'14 * "I.llftll'l""N J ............. .t'l1\ ~ f ' I PAGE 1/1 t RCVD AT 1f26/2010 3:35:40 PM ~ a s t e r n Standaid Time] *SVR:DC}AAU Ii!} " 1 J 1 ~ 1 \ ) : ~ i J IJ " vi)IIJ:!U! , VI II I IJYM IIV \ 1 I 1 I 1 I ' ~ ~ } I U 1 J ' J U