!: How One Ministry is Using Nonprofit Law to Sell Junk Bonds, Protest Obamacare, and Build a Theme Park of Biblical Proportions

Thirty-four years ago, was a public school science teacher in Australia. These

days, he is better known as the founder and president of (AiG), a religious

501(c)(3) organization currently planning the nation’s first ’s Ark amusement park.

As of 2013, AiG is the largest apologetics organization in the world. Apologetics is a field of theology that aims to build faith in the ’s literal accuracy. In 2007, AiG opened the

doors to its first foray in tourism, the in Petersburg, . Funded entirely

through private donations, the museum promotes a Young Earth creationist explanation of the

origin of the universe based on a literal interpretation of Genesis. Following the success of this

venture, the AiG board decided the time was right to erect a full-scale Noah’s Ark.

Together with the , AiG announced plans for the so-called Ark

Encounter in December 2010. Featuring a , “Ten Plagues” ride, and antediluvian

village, the park’s crowning glory will be a life-size (approx. 500’x80’x50’) wooden ark.1 The

project’s first phase will require $73 million, with an extra $24.5 million needed to break

ground2 and an additional $52.6 million in projected future phases.3 Kentucky has pledged to

1 Mark Joseph Stern, Noah’s Wreck: Ark Encounter, a creationist theme park, is selling junk bonds, SLATE.COM, http://www.slate.com/articles/health_and_science/science/2013/11/ark_encounter_finances_oba macare_sank_ken_ham_s_creationist_theme_park.html (Nov. 12, 2013, 7:53 AM). 2Id. 3 ARK Bonds: Executive Summary, ARKBONDS.COM, http://www.arkbonds.com/files/Executive_Summary.pdf (July 2013). contribute up to $37.5 million in tourism tax incentives to the park; however, these are set to

expire in May 20144 and as of November 2013, AiG has only raised $13.6 million.

Initially mum on the park’s slow progress, Ham explained the delay in a letter to

supporters this fall, placing the blame on—what else?—Obamacare. CCO Mark Looy explicated

thusly: original fundraising plans depended on a private placement equity offering for investors

who would become limited equity members in Ark Encounter, LLC, of which AiG would act as

the controlling member.5 However, in light of the Affordable Care Act’s passage, lawyers

advised AiG that the LLC would be required to provide employees with abortion-inducing drugs

under their health plan.6

The solution, it seems, was to instead operate as a religious nonprofit, so as to claim

religious exemption from the mandate to supply “abortion-inducing drugs” while still issuing

private bonds. How it will work: bonds will be issued by Williamstown, KY, with Crosswater

Canyon, Inc.—a nonprofit controlled by AiG—and Ark Encounter, LLC (solely owned by

Crosswater Canyon) as co-borrowers.7 Supporters will be able to purchase bonds ranging in price from $5,000 to $250,000 with 7-, 9-, 11-, and 15-year maturities at yields between 5.25 and

6.00%. But buyer beware! These are not the bonds a prudent investor would want. These are

4 Mary Wisniewski, ‘Ark Encounter’, Noah’s Ark Theme Park, Hopes to Show Biblical Flood was ‘Plausible,’ REUTERS, http://www.huffingtonpost.com/2013/05/31/noahs-ark-theme- park_n_3367579.html (Some critics argue these incentives are a violation of the constitutional divide between church and state.) (last updated June 1, 2013, 4:21 PM). 5 Stern, supra note 1. 6 Presumably, this is a reference to ACA-mandated coverage of Plan B, which is not, in fact, an abortion-inducing drug, but Looy says that regardless, this would be unacceptable for the religious organization. 7 Matt Young, God Moves in Mysterious Ways: Ark Park to Raise Money Using Bonds for an Interesting Reason, PANDA’S THUMB.ORG. http://pandasthumb.org/archives/2013/09/god-moves- in-my.html (Sept. 15, 2013, 2:40 PM). terrible investments for four reasons: they will be (1) practically unsellable, (2) unrated, (3) callable, and (4) secured only by the revenues and assets of Ark Encounter, LLC.

In short, AiG is selling creationist junk bonds via a religious nonprofit in its control to skirt healthcare mandates and erect a $150 million biblical tourist attraction in Kentucky.

Caitlin Cusimano University of Oregon November 13, 2013