Group to Submit Comments on Proposed FEC Rule Changes on Behalf of More Than 600 Nonprofit Organizations
WASHINGTON, D.C. – The Coalition to Protect Nonprofit Advocacy will submit comments tomorrow to the Federal Election Commission registering the opposition of more than 600 nonprofit organizations across the nation to the FEC’s proposed new rules. The proposed changes would drastically curtail free speech for nonprofits and could bankrupt many of them.
Highlights of the comments include concerns that the proposed rules raise such profound restraints on First Amendment rights that the Congress – and not the FEC – is the proper body to consider these changes.
The Coalition also argues that the FEC should not rush in the middle of an election year to pass new rules that far exceed what Congress intended in passing the McCain-Feingold law and what the Supreme Court affirmed in upholding it in last year’s McConnell decision, which said the law did not apply to interest groups beyond political parties. Some of the members of the Coalition were strong supporters of the McCain-Feingold law.
Attached is a list of possible scenarios that could result if the proposed rules were implemented.
According to the Coalition, “[T]he proposals ... would cause countless nonprofit organizations to drastically curtail their current programs or significantly alter the way in which they raise funds and conduct their activities. The proposed rules would seriously impair vigorous free speech and advocacy, as well as voter participation now and in the future.”
“This] is an ill-conceived attempt to fit a square peg (nonprofit organizations) into a round hole (the rules applicable to political party committees) that not only vastly exceeds the FEC’s authority but also would usurp Congress’ proper role in this area. The Commission should withdraw the proposed rules,” the Coalition continues.
The Coalition to Protect Nonprofit Advocacy is led by eight national organizations, including the Alliance for Justice, Leadership Conference on Civil Rights, League of Conservation Voters, NAACP National Voter Fund, NARAL Pro-Choice America, People For the American Way, Planned Parenthood Federation of America, and Sierra Club.
The submission of written comments will be followed by testimony from representatives of the Coalition at hearings before the FEC on Wednesday, April 14, and Thursday, April 15.
So far, little attention has focused on the fine print of the complex proposed rules and their far-reaching implications for all nonprofits, including charitable and advocacy groups organized under Sections 501(c)(3), 501(c)(4) and 527 of the federal tax code. A vast number would be essentially silenced on the issues that define them.
Indeed, the proposed rules have tapped an enormous wellspring of national protest from nonprofits. In a sign that opposition to the proposed rules cuts across the ideological spectrum, the U.S. Chamber of Commerce, Americans for Tax Reform and the Club for Growth have also filed comments deploring the proposed regulations.
The rules drastically expand the definitions of “political committee” and “expenditure” in the campaign finance arena. As a result, the vast majority of nonprofits risk becoming federally regulated political committees if they spend minimal amounts of money on certain types of communication and other activities that express views on an officeholder’s performance and public policy.
Under the most draconian proposal, the FEC could “look back” at a nonprofit group’s activities over the past four years – to a time before McCain-Feingold was ever passed and long before the FEC ever proposed these rules – to determine whether the group qualifies as a federal political committee. If group qualifies, the FEC would require the organization to raise hard money to repay prior expenses that are now subject to the new rules. Any and all further work would be halted until debts to the “old” organization were repaid. This rule would jeopardize the survival of many groups.
EXAMPLES OF SPEECH THAT WOULD BE SEVERELY RESTRICTED OR PROHIBITED BY THE FEC’S PROPOSED RULES
Ironically, the kind of analysis of campaign contributions and political outcomes that led to the passage of the McCain-Feingold law would be treated as a prohibited corporate “expenditure.” For example, if Democracy 21 wished to mail to 500 of its supporters a series of reports that criticized members of Congress running for reelection for changing their votes on Medicare reform after receiving contributions from the health insurance industry, it could not do so.
● The American Red Cross could not run newspaper ads soliciting contributions to a fund for victims of a major flood in Louisiana if the ads also presented in a favorable light a message from a U.S. senator from Louisiana who was running for re-election requesting assistance for his state.
● The National Rifle Association could not send letters to a list of activists urging them to call their members of Congress to oppose a bill banning all guns if the letter could be read as criticizing those members of Congress and they were standing for re-election.
● A “good government” organization like Common Cause would become a “political committee” by launching a campaign costing more than $50,000 to promote a report criticizing members of the House of Representatives for taking junkets to the Bahamas as guests of the hotel industry.
● The Club for Growth could not use corporate contributions to provide information to the public regarding federal candidates’ voting records on budget issues.
● The NAACP would have to stop its 2004 non-partisan voter registration campaigns on July 5.
● The Concord Coalition could not communicate its message of fiscal discipline and opposition to federal spending increases to the public as part of a fundraising and recruitment campaign if it identified specific members of Congress as favoring such spending increases and those members of Congress were running for re-election.
● The League of Women Voters would become a “political committee” by spending more than $50,000 during 2004 to send letters to all registered voters in a community urging them to vote on November 2, 2004, because “it is your civic duty.”
● A church or other 501(c)(3) organization could not publish a legislative report card during an election year covering all members of Congress on a broad range of issues highlighting specific votes as good or bad.
● Rock the Vote, an organization that primarily encourages voter registration and voting among young people, could be required to recreate itself as a federal political action committee (“PAC”), and would be prohibited from accepting any foundation contributions.
● A state right-to-life group that accepts contributions from local businesses could not use its general funds to criticize an incumbent federal candidate’s position on abortion rights after the candidate had officially declared himself for reelection - even if this announcement took place more than a year before the next election.
● Chinese for Affirmative Action could not hold its annual fundraiser at a corporate-donated facility or accept contributions from donors who have already given $5,000 for that year, if it urges members of the Senate running for re-election to oppose a nominee for a federal judgeship and informs the public of where these members stand on the nomination.
● Indeed, if the nation were to experience again a tragedy like the attack on the World Trade Center, Macy’s would not be allowed to convert its pre-paid ads in the newspapers into expressions of national solidarity if the ads said: “Mr. President, America stands behind you.”