Lobbying Now For Everyone, Almost

February 15, 2010       Kate Rogers      

The U.S. Supreme Court’s decision in Citizens United v. Federal Election Commission (FEC) is being hailed as a major win for nonprofits on one side, while others fear the interests of large corporations and their money will drown out the voices of others.

In a 5-4 vote, the justices lifted a ban that prohibited corporations from using money to pay for campaign advertisements supporting a specific issue or candidate. The ruling leaves in place a prohibition on direct contributions to candidates from corporations and unions.

The case centered on the conservative group that produced a film critical of now Secretary of State Hillary Clinton. The 501(c)(4) organization, which accepted corporate money, had planned to distribute the film through on-demand cable and promote it during the 2008 Democratic presidential primary as she sought the party’s nomination. The FEC saw the film as a campaign ad, which would limit Citizens United to using disclosed contributions from individuals to promote and broadcast it. The organization filed suit and appealed all the way to the nation’s highest court.

Larry Ottinger, president of the Center for Lobbying in the Public Interest (CLPI) in Washington, D.C., described the landmark decision as “a critical and defining moment for nonprofits.” The ruling affects nonprofits’ and foundations’ “relevance, influence and clout in shaping solutions to the nation’s problems,” he said. “This needs to be a wakeup call to get us to change the culture and the rules that have held back too many from engaging in advocacy and civic and policy matters for far too long,” Ottinger said. The rules that dictate nonprofit advocacy must be re-examined and Internal Revenue Service (IRS) charitable lobbying rules simplified and updated, he said.

Charities and foundations are limited, but not prohibited, from engaging in nonpartisan, political election-related activities. Foundations are prohibited from directly lobbying while charities are limited in their lobbying. “How do we ensure that nonprofits are at the table with business, labor, with the policy makers in terms of developing and shaping policies that directly affect those we serve and work with, and care for, and all the different types of issue areas in which we’re involved,” Ottinger said.

He’s hopeful issues that have been pushed aside or avoided because they make organizations nervous will be put on the front burner. “There’s a lot of confusion, fear and lack of knowledge in the area of nonprofit advocacy,” Ottinger said, adding that the sector must prioritize civic and policy engagement in terms of resources. “We need a discussion about this more broadly. How do we get involved with changing the rules and culture around involvement? We can’t afford to be second-class citizens anymore in democracy,” Ottinger said.

“There’s too much happening that’s too important to our missions for us not to be more involved. There’s no place anymore for the fear or questioning of whether we should be involved,” he said. Only a small percentage of resources go toward advocacy efforts, Ottinger said, describing the sector as having “a huge, untapped potential for political and policy influence.”

With no “bright line standards” on nonprofit involvement, Ottinger said the vast majority of small and mid-sized nonprofits too often stay out of the process. “They’re in a position where they have to hire a lawyer to be involved in democracy, and that’s not right,” he said. “At a minimum, this will give these issues the attention and resources they deserve. Ultimately, it is our relevance and our impact on missions for and with the people that we serve that are in the balance.” While some are considering this a major win for tax-exempt organizations, others fear the interests of large corporations, with more money in their corner, will drown out the voice of charities.

In a statement from the Service Employees International Union (SEIU), Secretary-Treasurer Anna Berger said the nation’s highest court all but “lifted the floodgates and started dismantling century-old restrictions on corporate electoral activity in the name of ‘free speech rights’ for corporations.” Richard Viguerie, chairman of ConservativeHQ.com and founder of American Target Advertising, both in Manassas, Va., said the ruling enables nonprofits to keep politicians in line in future elections. “The last thing I want is politicians deciding when you can speak and what you can say,” Viguerie said. “How outrageous is it for politicians to pass legislation that bans nonprofits from talking about them, two months before the election? This gets us back in sync with the U.S. Constitution.”

More liberal politicians have support from charitable organizations, he said, therefore the decision will ultimately favor the political left. “They have many more, and larger organizations than conservatives,” Viguerie said. “In recent history it has been that liberals are prepared to put larger sums of money into liberal nonprofits. However, all nonprofits have a responsibility to promote their views on public policy and keep politicians on the straight and narrow.” Washington, D.C.-based OMB Watch expressed concern that corporations will heavily manipulate the future of politics. “This ruling will really tip the balance for corporate money to influence elections that particularly 501(c)(3) organizations would never be able to do. This is a threat to our democratic process and civic engagement. It undercuts the voices of nonprofits,” said Lee Mason, director of nonprofit speech rights.

Nonprofits are uniquely positioned to speak out about social issues and solutions, speaking for their constituents rather than for commercial or economic purposes, according to a statement from Washington, D.C.-based Alliance For Justice (AFJ). While the decision eliminates “some of the limitations on nonprofit speech,” AFJ said “this new avenue of free speech might be overshadowed by a flood of for-profit corporate money into elections. With fast-approaching federal, state and local elections in 2010, this ruling further complicates the complex landscape that nonprofits must navigate to participate in the policymaking process.” “We hope nonprofits seeking to ensure their constituents are well served will not let this new landscape discourage them from participating in the electoral process. AFJ will work hand-in-hand with its members and the nonprofit community to successfully steer through the post-Citizens United political arena. It may be a bumpy ride as calls for new legislation to reverse the course the Roberts court has taken are already being heard.

Nonprofits will no longer have to choose between policy and candidate debate, according to Ronald Jacobs of Venable Government Affairs, LLP, in Washington, D.C. “It’s helpful to influence policy through a candidate who is running,” he said. “This gives them greater ability to participate in the public dialogue. Many for-profit corporations are not willing to go out on a limb and fund advertisements directly, so the way they can influence (politics) is through trade associations and nonprofits.” Those charities that are advocating for particular issues will be the first to make use of this decision, he said. “Those that are highly engaged in policy debates and others that are currently in political debates will jump in,” Jacobs said. “Associations are all over the map politically, so it depends on their issues.”