How can 501(c)(3) organizations engage in LOBBYING and ADVOCACY? Nayantara Mehta Alliance for Justice
Nov 27, 2014
How can 501(c)(3) organizations engage in LOBBYING and
ADVOCACY?
Nayantara Mehta Alliance for Justice
AGENDA
1. Comparing 501(c)(3)s and 501(c)(4)s
2. What is advocacy?
3. How much lobbying can a 501(c)(3) do?
4. What is lobbying?
5. Keeping track of lobbying
Comparing NONPROFITS
501(c)(3) 501(c)(4)Political
Organizations
Examples
Tax Treatment
LobbyingActivities
ElectoralActivities
Contributions tax-deductible
Tax-Exempt
Private Foundation grants
Tax-Exempt Tax-Exempt
Limited Unlimited Rare and usuallytaxable
Cannot support or oppose a candidate
for office
Usually, sole activity
Secondary activity
Follow federal and state election law
IndependentEmily’s List
Connected/SSFLCV PAC
What is ADVOCACY?
Organize Communities
Educate Public
Educate Legislators
Nonpartisan Voter Ed.
PARTISAN POLITICAL
LOBBYING
Encourage Voting
Educational Conferences
Research
Lobbying Exceptions
Change Corporate Behavior
Skills Training
Regulatory Efforts
Litigation
Avenues for ADVOCACY
Advocacy Capacity Tool (ACT) www.BolderAdvocacy.org/ACT
Nonprofits can and should
ADVOCATE & LOBBY forPOLICY CHANGE!
How much LOBBYING?
How Much LOBBYING?
INSUBSTANTIAL PART TEST
1. Lobbying is an “insubstantial part” of the organization’s activities, no clear limits or definitions
2. Default test
or
501(H) EXPENDITURE TEST
1. One-time election – IRS Form 5768
2. Definitions of lobbying
3. Dollar based limits
4. Expenditures only
$62,500
$250,000
Chart Title
Education & Non-Lobbying
Advocacy
TOTAL LOBBYING LIMITSfor a 501(c)(3) using the 501(h) election, with annual expenditures of $2 million
Overall Lobbying Limit
Grassroots Lobbying Limit
Grassroots
Direct
LOBBYING Definitions
LOBBYING for organizations using the Insubstantial Part Test:
- Contacting legislators to propose, support, or oppose legislation
- Urging the public to contact legislators to propose, support, or oppose legislation
- Advocating the adoption or rejection of legislation
Attempting to influence LEGISLATION
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
LOBBYING for organizations using 501(h)
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
Federal Members of Congress
State State Legislature
Local City Council, County Board of
Supervisors
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
President, governor, mayor or other executive official who participates in the formulation of legislation
SPECIAL “LEGISLATOR” RULEMembers of the general public are “legislators”
Ballot Measures
Ballot initiatives
Referenda
Constitutional amendments
Bond measures
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
NOT “LEGISLATORS”
Special Purpose Boards:
School boards Planning
commissions Zoning
commissions Water districts
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
Regulations
Executive Orders
Enforcement of Existing Laws
Litigation
NOT LEGISLATION
LOBBYING or NOT? Urging city council members to pass local living wage
ordinance:
Meeting with Planning Commission to oppose permit for expansion of oil refinery:
Urging DHS Secretary to support the DREAM Act and to reform immigration enforcement practices by DHS:
Educating legislators about public opinion on climate change and need for government to act (with no pending or proposed legislation):
LOBBYING
NOT LOBBYING
PARTIALLY LOBBYING & PARTIALLY NOT LOBBYING
NOT LOBBYING
CALL TO ACTION
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
TELLING TO CONTACTlegislator(s)
PROVIDING ADDRESS,telephone number, and/or other
contact information of legislator(s)
PROVIDING MECHANISMto enable communication
with legislator(s)
IDENTIFYINGlegislator(s)
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
Legislator
Expresses a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action Not Lobbying
Not Calls to Action: “Learn more” “Take action” “Support our efforts” “Get involved”
DIRECT
Communication
With a legislator
Expressing a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
DIRECT
Communication
With a legislator
Expressing a view about specific
legislation
GRASSROOTS
Communication
General public
Expresses a view about specific
legislation
Call to action
Nonpartisan analysis, study, or research
Request for technical assistance
Self defense
Examinations and discussions of broad social, economic, and similar problems
Lobbying EXCEPTIONS
MUST
Full and Fair Discussion
Broadly Disseminated
MAY
Express a View
Indirect Call to Action
Subsequent Grassroots
Lobbying limited
Nonpartisan ANALYSIS
Request for Technical ASSISTANCE
MUST
Invitation in Writing on behalf
of Committee
Available to all members of Committee
MAY
Express a View on Specific Legislation
REMEMBER:
Nonprofits can and should lobby; 501(c)(3)s just have to stay within their annual lobbying limits
Using the 501(h) option will simplify lobbying planning and reporting
Only what meets the definition of lobbying counts toward a 501(c)(3)’s lobbying limit
Track staff time spent on lobbying in order to report to IRS annually
How to KEEP TRACK
REASONABLEallocation
501(h)
Direct Costs
Staff Time
Overhead
INSUBSTANTIAL PART
Volunteers
Activities Specified on Form 990
501(h)
Direct Costs
Staff Time
Overhead
INSUBSTANTIAL PART
Volunteers
Activities Specified on Form 990
$15,000
Overhead
10% Direct
Lobbying
5% Grassroots Lobbying
Cost Center Direct Grassroots
Direct Costs $60 $100
Staff Time $750 $250
Overhead $1500 $750
Total Expenditures
$2310 $1100
Total Lobbying EXPENDITURES
501(h)
Direct Costs
Staff Time
Overhead
INSUBSTANTIAL PART
Volunteers
Activities Specified on Form 990 + a
“detailed description”
For more information:
QUESTIONS?
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