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The Connection

On this episode, we discuss The Connection, Bolder Advocacy’s go-to guide on how to create and operate 501(c)(3)s, 501(c)(4)s, and political organizations. In 2024, we release our 5th edition of The Connection and include several important updates your nonprofit needs to know about as we move into a contentious election season. If your nonprofit has questions about how to safely operate affiliated organizations or how to boost civic engagement in coalition with organizations that have a different tax-exempt status than your own, The Connection has the answers.

 

Attorneys for this show

Natalie Ossenfort, Sarah Efthymiou, and Susan Finkle-Sourlis

 

Show Notes

·      The Connection is one of Bolder Advocacy’s core advocacy resources.

o   It pairs well with:

§  “Being a Player” (guide to lobbying regulations for advocacy charities)

§  “The Rules of the Game” (guide to election-related activities for 501(c)(3)s)

o   This is the go-to resource for organizations on how they can amplify their impact and build grassroots power by utilizing multiple types of tax-exempt entities to address social problems and pursue policy change.

o   It discusses the best practices you need to know about when working with 501(c)(3)s, 501(c)(4)s, and PACs

o   The Connection was first published in 1988 and is primarily authored by Holly Schadler at Trister, Ross, Schadler, and Gold (with contributions from several of her teammates and allies in the field)

o   5th Edition releasing end of February or early March 2024

 

·      What can you find in THE CONNECTION?

o   Details on several different types of tax-exempt organizations and the advocacy activities they can engage in

o   The rules 501(c)(4)s need to know when lobbying and engaging in political activities

o   Information on how to create and operate affiliated c3 and c4 organizations (including a step-by-step overview of c4 formation procedures)

o   The rules governing PACs (including state PACs federal PACs and 527s)

o   Sample cost sharing agreement, sample 501(c)(3) public charity to 501(c)(4) grant agreement, information on the Lobbying Disclosure Act, and more!

 

·      What’s new in the 5th edition?

o   Information on new FEC disclaimer requirements for “internet public communications”

o   Social media guidance for affiliated 501(c)(3) and 501(c)(4) organizations

o   Details on a recent FEC ruling impacting the use of disclaimers for text messaging

o   Requirements for Super PACs and hybrid PACs (also known as Carey Committees)

 

·      “The Connection” also contains several concrete examples to illustrate how the rules apply in real-world scenarios (utilizing fictional tax-exempt organizations, of course).

o   These examples answer questions like:

§  What happens when a 501(c)(3) wants to make a grant to its affiliated 501(c)(4) for an educational research project?

§  What happens when a 501(c)(3) conducts a nonpartisan voter registration drive and wants its affiliated 501(c)(4) to have access to the list of registered voters? You’ll find out in “The Connection” that it can’t just give the list to its affiliated 501(c)(4) at no charge, but it could in some instances (when allowed under state law) sell its list at fair market value via an arms-length transaction.

§  And, what happens when a c4 publishes a monthly magazine on mission-related issues and then, in one edition of the magazine, decides to include an article about its candidate endorsements?

 

·      There are examples of required disclaimers for independent expenditures and electioneering communications too.

o   Brand new FEC regulations, published in January of this year, clarify what types of communications fall within the definition of “internet public communications” and what types of disclaimers are required when these communications expressly advocate for the election or defeat of federal candidates.

o   The latest edition of “The Connection” addresses how the law requires these disclaimers to be adapted for different communication formats. Whether it’s a communication including text and graphics, a video, or an audio-only statement, disclaimer requirements vary.

o   As such, “The Connection” is not only good for frontline nonprofit advocates, but for Communications, HR, and Accounting staff too!

 

Resources

The Connection (Strategies for Creating and Operating 501(c)(3)s, 501(c)(4)s, and Political Organizations)

Being a Player (A Guide to the IRS Lobbying Regulations for Advocacy Charities)

The Rules of the Game (A Guide to Election-Related Activities for 501(c)(3) Organizations)

Grassroots Advocacy

Exploring grassroots advocacy and the various activities that grassroots organizations can use to advance their mission and bring about positive policy change.

Attorneys for this Episode

Monika Graham

Natalie Ossenfort

Victor Rivera

Shownotes

 Introduction  Issue Advocacy and Lobbying  Rallies, Town Halls, and Community Mobilization  Persuading Elected Officials  Advocacy Days and Lobbying  Ballot Measures and Elections  Commenting on Candidates and Campaigns  Get Out the Vote Campaigns  Spotlight: Grassroots Organizations  Resources and Conclusion

Nonpartisan Election Year Advocacy

On this episode, we discuss best practices for 501(c)(3) public charities conducting advocacy and nonpartisan activities, like get out the vote or voter education activities during an election year. Election year is upon us and the presidential primaries and caucuses, and primaries for other elected offices are starting to take place and will continue through the November General election.  

Attorneys for this show

Monika Graham, Susan Finkle-Sourlis, and Leslie Barnes

Show Notes

·      May 501c3 public charities advocate in an election year? How can a public charity be involved in an election?

·      Types of nonpartisan activities that a 501(c)(3) may conduct include:

o   Educating voters and candidates on the issues that are important to the people/community the organization serves.

o   Mobilizing voters and supporting democracy

o   Hosting candidate debates and forums

o   And much more

 

·      What are the IRS regulations surrounding advocacy and democracy work

o   IRS has held that supporting democracy is a charitable activity, 501(c)(3)s have a role to play in our elections!

o   Activities must further the organization’s charitable mission

o   Activities must remain nonpartisan, cannot support or opposition of candidates running for public office

 

·      The Facts and Circumstances test to determine whether or not communications or activities are nonpartisan.  

o   The IRS applies a “facts and circumstances” analysis to determine whether a charity’s communication is conducted in a nonpartisan manner or is really a veiled attempt to support or oppose candidates.

o   When the IRS says “support or opposition” of candidates, that prohibition is broader than the explicit act of giving money to a campaign or saying outright that you should vote or not vote for a candidate. It’s not a bright line rule.

o   Analysis is required across the spectrum of risk. It is an assessment of the risk. 

 

·      Discussion of the elements of the Facts and Circumstances Test.

o   Does the communication refer to a candidate or election?

o   Timing, upcoming election or is there another event outside of the organization that happened?

o   Organization is discussing its core issues? Or is it comparing the organization’s issues to a candidate’s position?

o   Who are you talking to? Who is the audience? Who are you targeting?

o   Do you have a track record of discussing the issue?

o   Are you discussing a wedge issue? What is a wedge issue?

 

** The discussion of this topic is from the view of 501(c)(3) public charities. Other types of nonprofits, like 501(c)(4)s do have the ability to undertake partisan activities as a secondary purpose.

 

Resources

Rules of the Game – Guide to nonpartisan election related activities for 501(c)(3)s

Comparison of 501(c)(3) and 501(c)(4) Permissible Activities – Chart

Praising and Criticizing Incumbents – Factsheet

The Connection

Ballot Measure Insights

On this edition, we’re thrilled to welcome Emma Olson Sharkey from Elias Law Group, bringing her fresh perspective after successfully guiding clients to victory in the critical 2023 Ohio reproductive rights ballot measure fight. Emma will help shed light on the essential considerations for tax-exempt organizations before taking the plunge into a ballot measure campaign.

Attorneys for this Episode

Quyen Tu

Tim Mooney

Emma Olson Sharkey

 

Shownotes

 

·      Introducing Emma

·      Lessons from Ohio:

o   Progressives can work together to protect fundamental rights – and can be successful, even in states where conservatives otherwise control the state.

o   We are seeing conservatives attack the ballot measure process at every point in the process. We need to think about what we can do to bolster our efforts from the very beginning to defend against attacks.

·       

·      Ballot measure considerations Two major considerations: state campaign finance obligations and federal tax implications:

o   State campaign finance rules:

§  Registration & reporting obligations

§  Is there already a main ballot measure committee?

§  Do you want to be an independent expenditure committee?

·      Will you trigger registration or reporting by your planned activity?

o   If so, will this include donor disclosure?

§  Disclaimer obligations (including those you might not have thought of) – both for entities themselves and top donors.

o   Also, need to be careful about implicating federal campaign finance rules – even referencing federal candidates or parties in communications could create coordination issues and lead to inadvertent in-kind contributions.

§  Advocacy and education outside of registration/reporting requirements

·      Typically, communications to the public on the general subject addressed by the ballot measure, which do not refer directly or indirectly to the ballot measure itself, will not be regulated by state campaign finance.

·      However, state laws vary so you should check state and local law to confirm.

o   Federal tax implications:

§  In general, for public charities, advocating for or against ballot measures will be considered “lobbying” under federal tax law; public charities can only do an “insubstantial” amount of lobbying.

·      If the organization measures its lobbying under the 501(h) expenditure test, it will need to count work on a ballot measure as direct lobbying once a petition is circulated among voters for signatures.

·      If the organization measures its lobbying under the insubstantial part test, the IRS has provided less clarity; generally “influencing legislation.”

·      Communications to the public on the general subject addressed by the ballot measure, which do not refer directly or indirectly to the ballot measure itself, will generally not be considered lobbying.

§  Since 501(c)(3) organizations can only do an “insubstantial” amount of lobbying, many entities that engage in ballot measure work are organized as 501(c)(4) organizations, which can do unlimited lobbying under federal tax law.  Also considered “primary purpose” activity.

 

Resources

 

·      Bolder Advocacy Ballot Measure Toolkit

·      Seize the Initiative

 

Nonprofit New Year’s Resolutions

On this episode, we’re going to talk about those pesky new year’s resolutions… and no, we’re not talking about signing up for a gym membership or signing up for a marathon. We’re talking about resolutions that nonprofit organizations can apply as we enter into the year 2024. As you all know, 2024 is like Stefon from SNL, it has everything…primaries, general elections, an additional day… So as you are headed for your holiday break, we wanted to leave you with a list of things your nonprofit organization can do as we head into the new year.  

 

AFJ Team Members on this Episode: 

Natalie Ossenfort 

Monika Graham 

Victor Rivera 

On this Episode: 

Top ten things your nonprofit organization can do to maximize its advocacy in 2024: [drumroll] 

Host an elections training for staff ahead of the 2024 primaries and general election.  

Remember that while 501(c)(3)s are not permitted to support or oppose candidates for public office, they CAN engage in nonpartisan election-related activities. 

Bolder Advocacy can help you navigate the do’s and don’ts with an elections workshop. Request a private workshop through our website or check out one of our many 2024 public webinars. 

Consider organizing a GOTV campaign or voter registration drive. 

Check voter registration deadlines that apply to primaries and general election. 

Brush up on your state’s voter engagement and registration laws. Check out our Practical Guidance – Voter Assistance series, created in partnership with The Democracy Capacity Project.  

Remember that all 501(c)(3) voter registration efforts must be nonpartisan. 

Prepare staff and volunteers to NOT answer the question: “Who should I vote for?” 

Offer services to all. 

Avoid partisan targeting. 

Invite members of your coalition to participate in a voter education campaign, which could include a nonpartisan candidate questionnaire and/or voter guide. Guidelines for creating 501(c)(3) safe candidate questionnaires and voter guides include: 

Use unbiased, open-ended questions (distributed to ALL candidates). 

Cover a broad range of issues. You’ll also want to avoid comparing your organization’s position on an issue to where candidates stand. 

Publish all responses impartially and equally (with no editing or variations in font, formatting, etc.), and make the final guide generally available to the public. 

Remember NOT to include candidate pledges. 

Also, do not coordinate with candidates and campaigns.  

Just remember, facts and circumstances matter, so consult with Counsel if you have any questions regarding your specific voter education activities. 

Organize events inviting public officials to speak during election season. Remember to make the distinction between a candidate appearance and an incumbent appearance.  

Candidate appearances: must invite all viable candidates, avoid expressing support or opposition for candidate, do not allow candidate fundraising, and ensure compliance with state and federal election laws. 

Policymaker appearances (in official capacity, unrelated to candidacy): No equal opportunity required, but make sure you’re working with official staff (not campaign staff) and that you reiterate to the incumbent and their staff in writing that you are a 501(c)(3) that is not allowed to support or oppose candidates. Incumbents who are also candidates should not mention their candidacy at your event. And you should also avoid speaking to their upcoming election and focus, instead, on their official acts as policymakers. 

If you are a 501c4, consider making independent expenditures or coming up with a list of endorsements. 

501(c)(4)s can engage in partisan political activity as a secondary activity of the organization, but they are prohibited from making candidate contributions and coordinating activities with federal candidates and campaigns (under federal election law) and are oftentimes subject to similar prohibitions at the state and local level. 

IE’s and other partisan activity may trigger campaign finance reporting. 

If your 501(c)(4) has an affiliated 501(c)(3), remember that 501(c)(3)s can’t support or oppose candidates. This means that any (c)(4) partisan work should be kept entirely separate from any joint projects you may have between your organizations and be carried out with (c)(4) resources ONLY. 

Don’t forget… you can continue to advocate or lobby for issues that are central to your organization’s mission! 

Know your organization’s lobbying limits

Be aware of state and local lobbying laws that might apply to your work. Our State Practical Guidance – Lobbying series (created in partnership with the Democracy Capacity Project) now includes state-level guidance for all 50 states and DC. 

Educate supporters, policymakers, allies, and other interested parties about the current policies and problems affecting your community. 

Produce resources that reflect the real story of your community and its needs. 

If you’re a 501(c)(3), avoid comparing your organization’s position on an issue to where the candidates or parties stand on that issue. 

Have a track record of working on the issue. 

Talk about issues as they arise, as opposed to timing your issue-based communications to coincide with upcoming election dates. 

Avoid suggesting how voters should vote or mentioning the election in relation to your issue advocacy. 

Don’t be afraid to comment on candidates or campaigns, but remember the facts and circumstances matter. To avoid impermissible partisan activity, 501(c)(3)s should: 

Focus on what was said (the issue), not who said it (the candidate). 

Avoid discussing a candidate’s record or qualifications. 

Avoid talking about voters and making references to upcoming elections. 

Avoid identifying candidates by name. 

Issue disclaimers / reminders of your (c)(3) status and inability to support or oppose candidates for public office. 

Make sure any staff who speak on behalf of the organization are well-trained and understand the rules. 

Write an Op-ed and share your expertise on an issue that is core to your nonprofit’s mission, and establish your organization as a trusted thought leader. 

Launch or engage in litigation to challenge an unconstitutional law 

Litigation is different from lobbying and not subject to c3 lobbying limits. 

Remember that state and federal courts matter. To learn more about your state courts or the federal judiciary, visit www.afj.org.  

 

Resources: 

What is Advocacy? 2.0  

Practical Guidance – Lobbying Series 

Practical Guidance – Voter Assistance Series 

Commenting on Candidates and Campaigns Factsheet 

Hosting Candidates at Charitable Events Factsheet 

Public Charities Can Lobby Factsheet 

BA’s Trainings and Events  

Firewalls & Programmatic Independence

On this episode, we discuss best practices for working in coalition and with affiliated organizations and the importance of firewalls to 501(c)(4)s that engage in independent expenditures.

Attorneys for this show

Monika Graham, Susan Finkle-Sourlis, and Leslie Barnes

Working in Coalition – Affiliated Organizations

·       Maximize advocacy and resources

·       501(c)(3) and 501(c)(4) activities

·       Establishing legal, financial, and programmatic independence

o   Separate names, logos, EIN, and activities

o   Cost sharing agreements

o   Separate or joint websites and social media accounts

o   Timesheets

o   Branding matters

Firewalls – 501(c)(4)s and political organizations, candidates and committees

·       What are independent expenditures?

·       Why are independent expenditures important?

·       Establishing firewalls to protect against impermissible coordination

·       Safe harbors for permissible communications

·       FEC firewall policy

 

Resources

Please check out the resources listed below and our extensive resource library at bolderadvocacy.org for more information on this topic. We hope you join us on a future episode of the podcast!

The Connection

The Practical Implications of Affiliated Organizations

Nonprofits Working Together

Working Together: Affiliation and Coalition Basics

FEC guidance on independent expenditures and firewalls

 

Advocacy Successes 2023

On this episode we’re excited to highlight nonprofit success stories from around the country. While we talk about lobbying on this podcast, legislative wins are one type of advocacy victory. We’ll look at some legislative victories as well as other types of advocacy such as relationship building, corporate advocacy, and funding wins.  For some organizations, legislative victories can bring additional resources to your community. For other organizations, legislative victories can serve as harm reduction in the interim while we build a multi-racial democracy. We’ll also highlight strategies for talking about advocacy success to your donors and community.

 

Lawyers for this episode

Leslie Barnes

Sarah Efthymiou

 

Ballot Measure Victories

·      Ohio Issue 1

o   Double digit victory

o   Intersectional coalition work of grassroots organizations

o   Ohioans for Reproductive Freedom was one coalition of community-led nonprofits ranging from faith-based organizations, to racial justice and transgender rights nonprofits, from labor organizations to trade associations.

·      Other states that led the way on democracy-related measures Ballot measure recap by Victor Rivera Labiosa

California Legislative Victories – “Hot Labor Summer”

·      SB 616, paid sick leave

o   CA Work & Family Coalition, a coalition of community nonprofits

o   Part of the coalition’s strategy involved gathering variety of voices to be heard by collecting stories and bringing those voices to the policy makers.

 

·      SB 525, minimum wage increase to $25/hour for CA’s lowest-paid health care workers

o   SEIU United Healthcare Workers West

 

Organizing Victories – Equitable compensation

·      Black Leadership Action Coalition of Kentucky (BLACK) and Advocacy Based on Lived Experience (ABLE) 2 grassroots organizations

·      Adopted policies that center impacted community members in their work by compensating directly impacted volunteers for contributing their lived experiences and community organizing skills.

·      See guest blog below in shownotes

 

Strategies for talking to funders

·      Follow your funder’s lead

·      Investing in Change for other metrics to measure success

·      Don’t take credit candidate victories

 

Resources

·      Ballot Initiative Strategy Center – Ballot measure hub tracking challenges to direct democracy, past and upcoming ballot measures

·      Democracy in Action: Analyzing November’s Key Ballot Measure Wins

·      Two-part piece on Equitable Compensation Alicia Hurle

o   The Power of Equitable Compensation in Community Organizing Spaces

o   Building Community Empowerment

Foundation Funding Tips for Public Charities

On this episode, we’re going to talk about funding… More specifically, how your nonprofit can raise dollars from private and public foundations to support your advocacy work. We’re joined on this episode by Emily Harting, AFJ’s Director of Foundation Relations.  

 

AFJ Team Members on This Episode: 

 

Emily Harting, Natalie Ossenfort, Victor Rivera  

 

   

Introducing Emily Harting  

 

Tips for Groups Working to Identify Potential Foundation Partners: 

  • Start with path of least resistance – review foundation websites. 

  • Find out who funds your organization’s allies (groups whose work you admire). 

  • Connect with board members to assess their networks and seek out their advice. 

  • Review your organization’s history of foundation funding and consider reapproaching former funders. 

 

Other Avenues for Foundation Research: 

  • ProPublica (free access) 

  • Instrumentl 

  • Candid 

 

Foundation Outreach Recommendations:  

  • Make the job of the foundation program officer as easy as possible. Show them clearly and succinctly the connection between the foundation’s priorities and the work of your organization.  

  • It’s always best to use a connection if you have one (i.e. board member or ally). 

  • Send an email introduction explaining your organization and how you think it aligns with the funder’s priorities. 

  • If your organization issued a report, is in the news, or is hosting an upcoming event, you can use that to prompt outreach to a potential funder. 

 

Best Practices When Preparing for a Meeting with a Potential Foundation Partner: 

  • Brief your staff, internal participants. 

  • Create a “POP” Agenda. 

  • Purpose (of meeting)  

  • Outcome (desired results) 

  • Process (rough outline of who speaks when and about what) 

  • If it’s an in-person meeting, plan to have some organizational materials ready. 

  • If possible, also have resources ready to send following the meeting to continue to build communication/relationship.  

Proposal Process: 

  • Understand foundation proposal guidelines and preferred templates (if any). 

  • If they don’t have a template or provide guidelines, best to build a general template including: 

  • Intro paragraph with funding request ($$ and purpose: program/GOS);  

  • A brief overview of who your organization is and its history;  

  • A description of your programs and recent work you’ve done;  

  • Conclusion reinforcing your request.  

  • Connect your work to the foundation’s mission to demonstrate shared priorities. 

  • Write clearly. 

  • If the foundation has a proposal submission portal, submit your application early in technical issues arise. 

  • Be prepared to provide a budget, proof of your 501(c)(3) status, recent audited financial statements or 990s, a board list with affiliation, a staff list, etc. 

 

What About General Operating Support (GOS)? 

  • Funders usually start with a project grant, but some will give GOS outright. 

  • Remember to keep the funder up-to-date on progress throughout the grant period and share work products (resources or reports, videos, testimonials etc).  

  • Report on the grant as requested, when requested, and with the materials requested.  

  • Your nonprofit is more likely to receive GOS after you have built a trust-based relationship with your funder. 

 

Other Practical Tips: 

  • Remember that both you and the funder are hoping your organization is a match: they want their funds to support great work!  

  • Program officers are people. You’ll achieve the best results when you have a trusted relationship with each other. 

  • Ask your program officers for advice and thoughts on your strategy and programs. 

  • Don’t be afraid of your funder. If you run into a challenge, tell them. They might able to assist you in overcoming it.  

  • Keep your funder in the loop. Don’t be afraid to toot your own horn!  

  • Play nice in the sandbox.  

  • Be real and be realistic.  

 

Resources: 

 

 

 

 

PAC Taxonomy

On this edition, we revisit PACs by talking about three different categories you run into every election cycle. What makes a Super PAC super? What can a traditional PAC do? And will the IRS revoke your tax-exempt status if your charity has to register or form a ballot measure PAC? We’re delving into PAC taxonomy to answer these questions today!

 

Lawyers for this episode

Tim Mooney

Susan Finkle Sourlis

Quyen Tu

 

Shownotes 

Defining the various types of PACs. We came up with two approaches.

1.     What activity you want to undertake?

2.     What kind of money you want to raise and in what amount?

What is your priority? If you want the most freedom in activities, then there are more restrictions on fundraising or vice versa.

We’re covering three types of PACs:

1.     Super PACs sometimes called IE PACs

2.     Traditional PACs (could be state or federal)

3.     Ballot Measure PACs

 

 

Resources

Seize the Initiative: A Legal Guide on Ballot Measures for Nonprofits and Foundations

Ballot Measures and Recalls: Basic Rules for 501(c)(3) Public Charities, 501(c)(4)s, and Unions

501(c)(3) Public Charities and Ballot Measures

Ballot Measures Toolkit (compilation of resources)

Nonprofit Requirements for California Ballot Measures (flow chart)

Ballot Initiatives: How Nonprofits Can Stand Up for Direct Democracy (blog)

A New Future for Reproductive Rights: Ohio’s Critical Elections (blog)

Nonprofit Coalition Helps Extend Health Insurance Coverage to 90,000 Nebraskans (blog)

Ballot Measure Committees: Campaign and Registration Requirements (California Secretary of State)

What is a California Ballot Measure Committee? (from the Fair Political Practices Commission)

Project Grant Rule

On this episode we explore ways foundations can support civic engagement projects, including lobbying. Many listeners may be familiar with general operating grants, but today we’re joined by an expert to share with us a secret weapon called the project grant rule, what it is, how it works, and who can benefit.  It is our honor to be joined by Abby Levine who is associate general counsel for the Robert Wood Johnson Foundation. If Abby’s name sounds familiar, she was Bolder Advocacy’s Director for over a decade, and we are thrilled she’s agreed to join us.

1.     What is unique about project grants?

2.     Why did the Robert Wood Johnson Foundation and Bolder Advocacy partner to create the Project Grant Rule Hub for foundation and projects of public charities?

3.     What resources will visitors find at the Project Grant Rule Hub?

4.     Can project grant dollars really be used by projects for legislative campaigns and lobbying?

5.     Are there any tips you can share about using the Project Grant Rule for foundations?

6.     What tips do you have for grantees who receive a project grant?

 

Resources

Project Grant Rule Hub

Videos

Explainer videos on the project grant rule in English

En español: ¿Qué es el Project Grant Rule?n

For Foundations – How to Use the Project Grant Rule

For Grantees – How to Use the Project Grant Rule

Written Resources

The Project Grant Rule

Budget Template Instructions

Project Grant Rule Budget Templates