Election Year Dos and Don ts for Nonprofits
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1 Election Year Dos and Don ts for Nonprofits Debra Wilson General Counsel September 2016 Nonprofits, including 501(c)(3) independent schools, are not permitted to engage in activities that support or oppose candidates for public office. Doing so can result in the loss of the school s nonprofit status or a tax on the school and the managers who approve of any expenditures that are made to engage in the political activity. The loss of the school s nonprofit status can be retroactive, causing the tax deductibility of gifts received during that time to be lost and the school to be treated as a taxable corporation during that window. Many educators encourage their students to stay abreast of national and international affairs, and this fractious election cycle has offered many opportunities to discuss current events in class. This publication provides dos and don ts for independent schools during election season, focusing on things in the school setting that the IRS may consider intervening in a political campaign. It is important, however, for schools to understand that this particular area of the law is highly nuanced and is affected by federal tax law as well as federal election laws and some state laws. These laws often exist in conflict with each other. In those cases, the most restrictive law is the one that the school must follow. Schools should also know that the IRS in particular looks at all of the facts and circumstances to determine if a school has engaged in supporting or opposing a particular candidate. One activity alone may not be the tipping point, but a series of activities together may cause a problem. For a thorough overview of the laws in this area, this publication from
2 the Alliance for Justice may be helpful. The IRS also has a number of resources, including this one, which provides some examples. The information provided in this publication is merely a guide for schools to gain a general understanding of the law in this area. Schools contemplating activities like the ones mentioned herein should work with legal counsel to ensure that their actions do not run afoul of either the Internal Revenue Code or the Federal Election Campaign Act. Schools can build a defense if their activities are guided in part by reasoned legal opinions. The fundamental rule all schools must keep in mind is that nonprofits may not support or oppose specific candidates for public office. The federal government considers this kind of activity campaign intervention and it can occur even if the school is speaking of issues rather than specific candidates. If an activity could reasonably be construed as the school helping or hurting a specific candidate whether through the school s actions, that of its staff members acting in that capacity, the use of school resources, or some other means then the school must consider whether engaging in that particular practice is worth the risk. The School Voice One of the most difficult issues for schools is ensuring that staff members do not express their candidate choices or leanings such that the statement appears to be an endorsement or condemnation of a specific candidate by the school. How can you make sure you don t cross the line? DON T comment on the actions, speeches, or policies of a particular campaign or candidate. DON T use the school s name, letterhead, or any other school signifier in such a way that an implied or actual endorsement or condemnation of a candidate can be reasonably inferred. DON T limit staff conduct in off-campus political campaigning without checking with legal counsel. This topic is often regulated by the state in which the school is located, and limiting such behavior can run afoul of state law.
3 But schools can and should offer guidelines to help faculty and staff. DO insist that staff avoid endorsing candidates during the school s meetings, events, online activities, or in other school-sponsored or school-related venues. DO insist that any staff members who make personal political endorsements, statements, or other outward acts of endorsement or condemnation do so outside of school activities. Staff should make it clear that the views expressed are their own and should avoid using the school s name if possible. If they must include their title for identification purposes, they should include clear language noting that the title is provided for identification purposes only and such statements do not reflect the school s position. DO provide guidance to faculty on issues that are specifically relevant to the school s mission or purpose. For instance, inclusiveness, diversity, empathy, and other issues are often part of independent schools regular student engagement. Be careful not to cross the line from issue education to specific candidate stances, statements, or other actions. In regard to these issues, the IRS looks to whether a specific candidate is referenced, whether the upcoming vote is mentioned, and whether the school has a track record of speaking about the issue outside of the election cycle. When in doubt, schools may wish to include a disclaimer noting that it does not endorse any candidates in upcoming elections. The IRS has provided guidelines to nonprofit institutions on issue communication. The IRS will consider whether the statement identifies one or more candidates for a given public office; whether the statement expresses approval or disapproval for one or more candidates positions or actions; whether the statement is delivered close in time to the election; whether the statement makes reference to voting or an election;
4 whether the issue addressed in the communication has been raised as an issue distinguishing candidates for a given office; whether the communication is part of an ongoing series of communications by the organization on the same issue that are made independent of the timing of any election; and whether the timing of the communication and identification of the candidate are related to a non-electoral event such as a scheduled vote on specific legislation by an officeholder who also happens to be a candidate for public office. DO ensure that administrative and senior staff members understand that their compliance with these rules is particularly important as their authority makes it easier to imply a direct correlation with the school s official position. Senior staff members, particularly heads of school and other positions reasonably seen as regularly representing the school, should avoid or limit campaign activity as such activity can be readily construed as being representative of the school. School Resources Nonprofit resources may not be used to support a candidate. Resources are defined very broadly, including everything from mailing lists to s to signs on campus. DON T use school communication channels (phones, s, social media, mailing lists, etc.) for any form of candidate endorsement. Take reasonable steps to ensure that staff members or volunteers avoid using these resources too. DON T allow election signs on school property that endorse a particular candidate unless they are part of a school-wide mock election for students or similar event for students that has clear educational goals and parameters. Talk to faculty, staff, and administrators about what s appropriate.
5 DO ensure that everyone knows they cannot use school copiers, phones, printers, websites, design tools, addresses, parent lists, alumni lists, etc., to support a particular candidate. 1 DO ensure that the webpages or other resources teachers create to help their classes understand the election process are done in an evenhanded manner such that all candidates for office are evenly represented through links and other materials. Candidates on Campus Many schools are honored when candidates wish to visit their school community. Setting clear guidelines will keep your school on the right side of the law. DON T allow candidates to fund-raise on campus or at school-related events. DON T allow board members or others to fund-raise for candidates on campus or at school-related events. DON T hold candidate rallies or similar campaign events on campus. Events that invite candidates to speak on campus must not be a campaign rally, engage in advocacy, or favor a particular candidate. What is appropriate for candidates on campus? DO invite all candidates for an office to debates, speeches, or forums, either at the same time or in different but comparable settings (e.g., two separate events during different weeks in the same venue and with the same structure and advertising). Not all candidates need to accept the offers in order to move ahead with an event, but the offers should be made and documented in the event that the school is challenged. 1 Staff members may, however, use their own cell phones to make campaign calls on their own time (including during their breaks).
6 DO make clear at any such event that the school does not endorse a particular candidate. Hold all events in a politically neutral manner, ensuring that the events do not turn into rallies or specifically favor a particular candidate. Make certain that that the topics discussed are broad ranging and not presented in such a way to obviously favor one candidate over another. Student Education Students can be more active on the political front than staff members because students are not usually considered a voice of the school and because learning about the political process is clearly within the educational purpose of the school. DO engage in activities that educate students about the political process. Students may absolutely learn about the election, even to the point of using class time to work on the campaigns of their choice. Just make certain they are given a legitimate choice in the campaigns they select. DO allow student editorials that voice opinions on candidates, policy, and other aspects of the political process. DO allow student groups to use school facilities and resources in the same manner as any other student groups (including fees, use of school technology, etc.) if such use is appropriate for your school s culture. If your school allows for such activity, also make clear that the activities of that group are on behalf of the students and not the school itself. DO ensure that staff advisors to school publications and student political groups still follow the neutrality principles for nonprofit staff members. Conclusion This election cycle has encouraged the leaders of some colleges and universities, such as the president of Wesleyan, to consider taking the risk to speak out about politics and candidates. Schools considering this approach should work with legal counsel to
7 understand the ramifications of such actions before engaging in this type of behavior. While personal passions and politics are running very high this year, school leaders are the stewards of their institutions and must consider risks such as the potential loss of the school s nonprofit status.
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