FOUNDATION Support for Nonprofit ADVOCACY 1. Overview of foundations and federal tax law 2. Avenues for advocacy by public charities 3. Lobbying rules for public charities under federal tax law 4. Foundation support for advocacy by public charities 5. Funding public charities who lobby 6. Funding voter registration drives by public charities 7. Advocacy capacity and evaluation AGENDA Overview of FOUNDATIONS & FEDERAL TAX LAW 1
501(c)(3) 501(c)(3) Private Foundation Public Foundation Examples Tax-Exempt Tax-Exempt Tax Contributions Contributions Treatment tax-deductible tax-deductible PROHIBITED LIMITED Lobbying Tax on foundation Insubstantial Part or Activities & managers 501(h ) Cannot support or Cannot support or Electoral oppose a candidate oppose a candidate Activities for office for office What is ADVOCACY? 2
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Public Nonpartisan Education Voter Ed. Community Organize Organizing a Rally Lobbying PARTISAN POLITICAL Exceptions Educate Regulatory Legislators Efforts Educational LOBBYING Conferences Get to Know Litigation Legislators Research Training Avenues for ADVOCACY by PUBLIC CHARITIES Create Systemic Change Protect Current Funding Educate Legislators Discuss Broad Social Issues, Foster Discussion Empower Your Constituents and Communities Why should nonprofits engage in ADVOCACY? Nonprofits can and should ADVOCATE & LOBBY for POLICY CHANGE! 4
LOBBYING Rules for PUBLIC CHARITIES INSUBSTANTIAL PART TEST 1. Default test 2. What is “insubstantial?” 3. Lobbying defined broadly: attempting to influence legislation or 501(H) EXPENDITURE TEST 1. One-time election – IRS Form 5768 2. Dollar-based limits based on annual expenditures 3. Narrow definitions of lobbying LOBBYING LIMITS for 501(c)(3) public charities under federal tax law DIRECT Communication Legislator Expresses a view about specific LOBBYING legislation under GRASSROOTS 501(h) Communication General public (same definitions for Expresses a view about specific private foundations) legislation Call to action 5
DIRECT Communication Legislator Expresses a view about specific legislation GRASSROOTS Communication General public Expresses a view about specific legislation Call to action DIRECT Federal Communication Members of Congress Legislator Expresses a view about specific legislation State State Legislature GRASSROOTS Communication General public Expresses a view Local about specific City Council, County Board of legislation Supervisors Call to action SPECIAL “LEGISLATOR” RULE DIRECT Members of the general public are “legislators” Communication Legislator Ballot Measures Expresses a view • Ballot initiatives about specific legislation • Referenda • Constitutional amendments GRASSROOTS • Bond measures Communication General public Expresses a view about specific legislation Call to action 6
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 7
NOT LEGISLATION Regulations Executive Orders Enforcement of Existing Laws Litigation DIRECT Communication Legislator Expresses a view about specific legislation CALL TO ACTION GRASSROOTS Communication General public Expresses a view about specific legislation Call to action DIRECT TELLING TO CONTACT Communication legislator(s) Legislator Expresses a view PROVIDING ADDRESS, about specific telephone number, and/or other legislation contact information of legislator(s) GRASSROOTS PROVIDING MECHANISM to enable communication Communication with legislator(s) General public Expresses a view IDENTIFYING about specific legislator(s) legislation Call to action 8
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 Not Calls to Action: about specific legislation “Learn more” “Take action” GRASSROOTS “Support our efforts” Communication “Get involved” General public Expresses a view about specific legislation Not Lobbying Call to action 9
“Exempt Purpose Annual Expenditures 1. Calculate organization’s Expenditures” (for most organizations) 2. Overall lobbying limit ANNUAL EXPENDITURES OVERALL LOBBYING LIMIT $500,000 or less 20% $500,000 to $1 million $100,000 +15% of excess over $500,000 $1 million to $1.5 million $175,000 +10% of excess over $1 million $1.5 million to $17 million $225,000 + 5% of excess over $1.5 million Over $17 million $1,000,000 3. Grassroots lobbying limit is 25% of overall limit TOTAL LOBBYING LIMITS for 501(c)(3)s making the 501(h) election with annual expenditures of $250,000 Direct Grassroots Education & Non-Lobbying Advocacy $50,000 Overall Lobbying Limit Grassroots Lobbying Limit $12,500 DIRECT Communication With a legislator Expressing a view about specific legislation GRASSROOTS Communication General public Expresses a view about specific legislation Call to action 10
DIRECT Communication With a legislator Expressing a view about specific legislation GRASSROOTS Communication General public Expresses a view about specific legislation Call to action Lobbying EXCEPTIONS Nonpartisan analysis, study, or research Request for technical assistance Self defense Examinations and discussions of broad social, economic, and similar problems 11
MUST Full and Fair Discussion Broadly Disseminated MAY Express a View Indirect Call to Action Subsequent Grassroots Lobbying Limited Nonpartisan ANALYSIS MUST Have Invitation in Writing on behalf of Committee Be Available to all members of Committee MAY Express a View on Specific Legislation Technical ASSISTANCE FOUNDATIONS can support ADVOCACY 12
Capacity Builder General Support(er) Build capacity of grantees to Funding grantees that advocate advocate and lobby through general support Convener Responder Bring nonprofits and policy Don’t proactively initiative policy leaders to the table to find change, but prepared to respond solutions Fund Specific Projects Be an Advocate Fund lobbying or non-lobbying Advocate LOUDLY or quietly for portions of advocacy projects your policy agenda FOUNDATIONS can SUPPORT ADVOCACY Capacity Builder General Support(er) Build capacity of grantees to Funding grantees that advocate advocate and lobby through general support Convener Responder Bring nonprofits and policy Don’t proactively initiative policy leaders to the table to find change, but prepared to respond solutions Fund Specific Projects Be an Advocate Fund lobbying or non-lobbying Advocate LOUDLY or quietly for portions of advocacy projects your policy agenda FOUNDATIONS can SUPPORT ADVOCACY 13
Capacity Builder General Support(er) Build capacity of grantees to Funding grantees that advocate advocate and lobby through general support Convener Responder Bring nonprofits and policy Don’t proactively initiative policy leaders to the table to find change, but prepared to respond solutions Be an Advocate Fund Specific Projects Fund lobbying or non-lobbying Advocate LOUDLY or quietly for portions of advocacy projects your policy agenda FOUNDATIONS can SUPPORT ADVOCACY 14
Capacity Builder General Support(er) Build capacity of grantees to Funding grantees that advocate advocate and lobby through general support Convener Responder Bring nonprofits and policy Don’t proactively initiative policy leaders to the table to find change, but prepared to respond solutions Fund Specific Projects Be an Advocate Fund lobbying or non-lobbying Advocate LOUDLY or quietly for portions of advocacy projects your policy agenda FOUNDATIONS can SUPPORT ADVOCACY Capacity Builder General Support(er) Build capacity of grantees to Funding grantees that advocate advocate and lobby through general support Convener Responder Bring nonprofits and policy Don’t proactively initiative policy leaders to the table to find change, but prepared to respond solutions Fund Specific Projects Be an Advocate Fund lobbying or non-lobbying Advocate LOUDLY or quietly for portions of advocacy projects your policy agenda FOUNDATIONS can SUPPORT ADVOCACY 15
Capacity Builder General Support(er) Build capacity of grantees to Funding grantees that advocate advocate and lobby through general support Convener Responder Bring nonprofits and policy Don’t proactively initiative policy leaders to the table to find change, but prepared to respond solutions Fund Specific Projects Be an Advocate Fund lobbying or non-lobbying Advocate LOUDLY or quietly for portions of advocacy projects your policy agenda FOUNDATIONS can SUPPORT ADVOCACY 16
Funding PUBLIC CHARITIES who LOBBY Funding PUBLIC CHARITIES who LOBBY 17
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