Donor Disclosure Proposal Worries Nonprofit Experts

By Suzanne Perry A new campaign-finance bill pending in Congress aims to lift the curtain on who is paying for advertisements and other communications that may influence elections. The bill created in response to a Supreme Court ruling earlier this year would require nonprofit groups organized under 501(c)4 of the federal tax code who issue political communications to reveal their top donors.   The legislations goal is to prevent advertisers from funneling money through shell groups to mask their identities. The proposal approved by the House Administration Committee last week has some nonprofit experts worried. But nonprofit groups should look long and hard at that provision says Ronald M. Jacobs a nonprofit and campaign-finance lawyer in Washington. There are many legitimate reasons why contributors to organizations might not want to be disclosed. Michael B. Trister -- a lawyer in Washington who briefed participants in a recent teleconference sponsored by the Alliance for Justice an association of environmental civil rights mental-health and other advocacy groups -- agrees. Some nonprofits are engaged in controversial work and their donors wouldnt want their support plastered over the airwaves he says adding that he wonders how the law would treat donors who make their contributions anonymously. Watching Closely Some nonprofit leaders are taking a wait-and-see approach to the House measure -- and a companion bill introduced in the Senate. Abby Levine deputy director of advocacy programs for the Alliance for Justice says her group supports the aims of the legislation but wants to be sure it does not unduly restrict issues speech. I wouldnt say we have concerns but we are watching it very closely said David Willett a spokesman for the Sierra Club an environmental advocacy group. The American Society of Association Executives -- which represents nonprofit trade and professional associations groups also affected by the legislation -- is more blunt. The donor disclosure requirements it said in a letter to the House Administration Committee go far beyond those that apply to political candidates who purchase ads themselves and aim to discourage spending that the Supreme Court said was protected under the First Amendment. Nonprofit groups like Common Cause and Public Campaign however praise the Congressional effort and say lawmakers need to go even further to curtail the influence of special-interest money in political campaigns. Citizens United Decision The House bill -- the Disclose Act H.R. 5175 -- was designed as an antidote to the Supreme Courts decision in Citizens United vs. Federal Election Commission. The court ruled 5 to 4 that a law barring corporations from using money from their general treasuries for express advocacy" -- to urge that a candidate for federal office be elected or defeated -- was unconstitutional. It also struck down rules that prohibited corporations from spending money on electioneering communications" -- TV or radio ads that mention a specific federal candidate -- within 30 days before a primary election or 60 days before a general election. Corporations and other groups affected by the ruling are still barred from contributing directly to political campaigns or coordinating with them. Among provisions in the House bill that would affect 501(c)4 nonprofit groups:

• Groups may create a separate account to pay for political communications. In that case they must disclose all donors who have contributed a minimum amount -- either $6000 or $10000 depending on the type of communication -- to the organizations general fund.

• Both the head of an organization that pays for a TV or radio political ad and the top financial backer of the ad must record statements that they approve the message. Television ads as well as political mailings must also list the top five contributors to the organization.

• Current rules prohibit organizations from coordinating express advocacy communications with political candidates. The new language would define that more broadly barring coordination on communications that could be interpreted as advocating a candidates election or defeat even if they do not specifically use those words.

The bill adopted by the House committee clarifies however that organizations would not violate the law simply by discussing legislation or policy with a political candidate.