Thursday, January 28, 2010

Citizens United vs. FEC

Hillary: The Movie, a film by Citizens United and the basis for the challenge to restrictions on corporate spending in Citizens United vs. FEC

Although the main conversations on the Citizens United vs. Federal Elections Commission Supreme Court decision have been about the impact on and by for-profit corporations, there are implications for nonprofit organizations as well.

The opinion, issued on January 21st and decided in a 5-4 split, supports the constitutionality of corporations making independent expenditures from their general treasury for electioneering communications (previously these expenditures had to be made through voluntary donations via a Political Action Committee).
Justice Stevens gave the dissenting opinion, quoted in part here:

"In the context of election to public office, the distinction between corporate and human speakers is significant. Although they make enormous contributions to our society, corporations are not actually members of it. They cannot vote or run for office. Because they may be managed and controlled by nonresidents, their interests may conflict in fundamental respects with the interests of eligible voters. The financial resources, legal structure,and instrumental orientation of corporations raise legitimate concerns about their role in the electoral process. Our lawmakers have a compelling constitutional basis, if not also a democratic duty, to take measures designed to guard against the potentially deleterious effects of corporate spending in local and national races."
Alliance for Justice offers some simplified bullet points for understanding the impact of Citizens United on nonprofit organizations, along with some key questions (will this ruling apply to labor unions?) . It also offers the following advice:
"While much of the focus has been about increased spending by for-profit corporations, it is important to remember that these changes apply to issue-based organizations that promote the social good. More than ever, nonprofit corporations can and should actively participate in elections. Even if you think the case was wrongly decided, 501(c)(4)s and other nonprofit corporations (except for 501(c)(3)s) should take advantage of it--use it to strengthen democracy by increasing your public communications about the candidates and what’s best for the future of our country."
Finally, in a recent phone briefing, the Alliance for Justice reminded the nonprofit community:
"501(c)(3)s remain subject to the absolute prohibition on intervening in an election campaign on behalf of or opposition to a candidate for public office. Therefore, little will change for public charities and private foundations as a result of this opinion."

2 comments:

Anonymous said...

why is the 501(c)(3) ban on electioneering by non-profit corporations not ALSO unconstitutional?

Rachel Adams, Nonprofit Voter Engagement Network said...

The reason is, simply, that donations to 501(c)(3) nonprofit corporations are tax-deductible. This is unlike 501(4)s, 501(c)(5)s, and 501(c)(6)s (comprising civic groups, labor unions, trade associations and similar groups).

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