Center for Non-Profits - FEC Alert 040204

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ALERT!! Non-Profit Advocacy, Voter Education Activities at Risk!

Your action needed to oppose FEC regulations

The Federal Election Commission (FEC) has issued for public comment proposed regulations that, if unchanged, could have a severe chilling effect on advocacy activities of a wide array of non-profit organizations, including 501(c)(3)'s. [Note: This article, drawn from our own review of the regulations and from analyses provided by the National Council of Nonprofit Associations, Alliance for Justice and others, focuses mainly on section 501(c)(3) organizations, but the impact of the FEC proposal is much broader.]

The proposed rules grew out of an advisory opinion issued earlier this year regarding the permissible activities of Section 527 political committees. Currently, the FEC defines a "political committee" as an organization that has $1,000 or more in contributions or expenditures and whose major purpose is to elect candidates to federal office. A group classified as a political committee by the FEC is subject to tight restrictions on its ability to raise funds from foundations, corporations, labor unions and individuals.

The new FEC proposed regulations could potentially go far beyond this initial scope. Much of the proposal takes the form of requests for comments to a variety of possible alternatives. Among the options, the proposed rule could drastically broaden the definition of a political committee to include all Section 527 organizations as well as ANY group which:

1) Has in ANY ONE OF THE PREVIOUS FOUR YEARS spent 50% of its budget OR $50,000 on:
* Communications that promote, support, oppose or attack a candidate for federal office; or
* Voter registration within 120 days of an election; or
* Get-out-the-vote activity; or
* Voter identification.

OR

2) Has as its major purpose to "promote, support, oppose or attack" federal candidates and spends $10,000 on:
* Communications that promote, support, oppose or attack a candidate for federal office; or
* Voter registration within 120 days of an election; or
* Get-out-the-vote activity; or
* Voter identification.

Although Section 501(c)(3) organizations are not permitted to endorse or oppose candidates for public office, nor to engage in partisan activities, current law does permit 501(c)(3)'s to engage in voter identification, voter registration, get-out-the-vote activities and certain other election-season activities provided they are done in a nonpartisan manner. Some of the options offered in the FEC rules make no exception for nonpartisan activities, which could retroactively subject these activities to "political committee" classification.

The phrase "promote or attack" a candidate for federal office is not defined, and could be interpreted to include genuine issue advocacy promoting or opposing legislation or policies of a sitting office-holder who is running for re-election. For example, a communication that is critical or supportive of President Bush's tax cut initiatives could be perceived as attacking or promoting CANDIDATE George W. Bush, even if the election or the President's status as a candidate are not mentioned in the communication. An organization that spends more than 50% of its budget or $50,000 registering young people to vote could be found to be a political committee.

Potential consequences of "Political Committee" classification:

Political committees are required to register and file financial reports with the FEC. Most significantly, however, the various bans on "soft money" contributions that exist as part of campaign finance reform would mean that the organization would no longer be able to accept contributions from foundations, corporations (including other non-profits), unions, or contributions from individuals in excess of $5,000. Note that this rulemaking does not affect current IRS rules governing advocacy, lobbying and political activity by non-profits. Nevertheless, the potential consequences of being defined a political committee by the FEC are very severe in their own right and could set a dangerous precedent for future policy by the IRS, Congress or other governmental bodies.

The scope of this proposal, combined with the 4-year "look back" provision, could pose devastating consequences for 501(c)(3)s and other organizations that engage in legitimate nonpartisan advocacy efforts. The proposed rule is long, complicated and has the potential to silence critical voices and squelch civic participation. The FEC has raised the possibility that the rule, if enacted, could become effective for the CURRENT election cycle. There is simply no justification for rushing through a ruling of this sweeping nature.

Action Needed:

The FEC is accepting written comments until April 9 (April 5 for those wishing to testify at the public hearings later in the month). When the first advisory opinion was considered in February, it was clear that the FEC did take notice of the strong response from the non-profit community and others. They need to hear from you, and so do New Jersey's U.S. Senators and Representatives!

Section 501(c)(3) organizations are already subject to strict bans on partisan activities. Please WRITE NOW to the FEC and urge them to exclude 501(c)(3) organizations AND true issue advocacy from the scope of the regulations. If your organization currently engages in nonpartisan election activities (e.g., voter education, get-out-the-vote drives, etc.) or issue advocacy, explain how the FEC's proposed rule might affect you. Send copies to Senators Jon Corzine and Frank Lautenberg and to your own Congressional Representative, urging them to exercise their leadership in opposition to these proposals. Contact information appears below.

For additional information including fact sheets and sample letters, contact Linda Czipo at the Center or visit www.nonprofitadvocacy.org , a web site created by a coalition of national organizations involved in protecting non-profit advocacy.

Important Contact Information

Address comments to the Federal Election Commission to the following address:
Ms. Mai T. Dinh, Acting Assistant General Counsel
Federal Election Commission
999 E Street, NW
Washington, DC 20463

Comments can be emailed to: politicalcommitteestatus@fec.gov

In your comments, reference "Notice of Proposed Rulemaking on Political Committee Status, 69 Fed. Reg. 11736"

New Jersey's Congressional Delegation

Senators:

The Honorable Frank Lautenberg (D)
324 Hart Senate Bldg., Washington, DC 20510
Phone: 202/224-3224 Fax: 202/224-4054
Email: http://lautenberg.senate.gov/webform.html
The Honorable Jon Corzine (D)
502 Hart Senate Bldg., Washington, DC 20510
Phone: 202/224-4744 Fax: 202/224-9707
Email: http://corzine.senate.gov/contact.cfm

Members of Congress:

(To email your Member of Congress, use the following link: http://www.house.gov/writerep/ )

The Honorable Robert Andrews (D-1)
2439 Rayburn House Bldg., Washington, DC 20515
Phone: 202/225-6501 Fax: 202/225-6583

The Honorable Frank LoBiondo (R-2)
225 Cannon House Bldg., Washington, DC 20515
Phone: 202/225-6572 Fax: 202/225-3318

The Honorable H. James Saxton (R-3)
339 Cannon House Bldg., Washington, DC 20515
Phone: 202/225-4765 Fax: 202/225-0778

The Honorable Christopher H. Smith (R-4)
2373 Rayburn House Bldg., Washington, DC 20515
Phone: 202/225-3765 Fax: 202/225-7768

The Honorable E. Scott Garrett (R-5)
1641 Longworth House Bldg., Washington, DC 20515-3005
Tel: 202/225-4465 Fax: 202/225-9048

The Honorable Frank Pallone, Jr. (D-6)
420 Cannon House Bldg., Washington, DC 20515
Phone: 202/225-4671 Fax: 202/225-9665

The Honorable Michael Ferguson (R-7)
214 Cannon House Bldg., Washington, DC 20515
Phone: 202/225-5361 Fax: 202/225-9460

The Honorable William J. Pascrell (D-8)
1722 Longworth House Bldg., Washington, DC 20515
Phone: 202/225-5751 Fax: 202/225-5782

The Honorable Steve Rothman (D-9)
1607 Longworth House Bldg., Washington, DC 20515
Phone: 202/225-5061 Fax: 202/225-5851

The Honorable Donald Payne (D-10)
2209 Rayburn House Bldg., Washington, DC 20515
Phone: 202/225-3436 Fax: 202/225-4160
The Honorable Rodney Frelinghuysen (R-11)
2442 Rayburn House Bldg., Washington, DC 20515
Phone: 202/225-5034 Fax: 202/225-3186

The Honorable Rush Holt (D-12)
1019 Longworth House Bldg., Washington, DC 20515
Phone: 202/225-5801 Fax: 202/225-6025

The Honorable Robert Menendez (D-13)
2238 Rayburn House Bldg., Washington, DC 20515
Phone: 202/225-7919 Fax: 202/226-0792

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