Washington Watch: Faculty and Politics
By Ruth Flower
The election season this year will offer a welcome respite from the political barrage we experienced last fall (and winter). The less frenzied pace of this year’s races means that there will be more time for faculty members to plan future political activities and try out new relationships with elected leaders.
Political activities? Relationships? Is that something faculty can do? Of course. As citizens, faculty members have both a right and a responsibility to participate in the electoral process. In addition, faculty may have a professional duty to help inform the decisions of elected leaders. But when faculty members form a group to engage in political activities, the group must adhere to election and tax laws.
Federal, state, and local election laws require groups and individuals to report certain political contributions and activities. Also, federal (and sometimes state) tax laws spell out the limits on political activity that tax-exempt organizations can undertake without losing their privileged tax status. Here are some questions to consider in light of federal tax laws.
First, what kind of an organization do you belong to? Your chapter or conference might be a charitable organization, described in Section 501(c)(3) of the Internal Revenue Code. Such organizations don’t pay taxes on their income, and people who donate to them can deduct their donations from their own taxable income.
Or your chapter or conference might be a civic organization, described in Section 501(c)(4) of the Internal Revenue Code. Such groups don’t pay taxes, but their contributors cannot deduct donations. Chapters and conferences that have not applied for 501(c)(3) status as a charitable organization, and do not operate as collective bargaining agents, would most likely be considered "civic organizations" under Internal Revenue Service regulations.
If your chapter is a collective bargaining agent, it is considered a labor organization under Section 501(c)(5).
Can your group endorse (or oppose) candidates? For charitable 501(c)(3) organizations, the answer is a clear no. These groups cannot even appear to support one candidate over another by, for example, inviting only some candidates to a forum, or writing about only one candidate in the chapter newsletter.
Civic 501(c)(4) organizations can take some steps to endorse or oppose candidates, as long as these steps are not the primary activities of the organization. There’s a morass of rules governing political activities by civic organizations, but some things are possible within the law. Within very specific rules, for example, civic organizations can advocate candidates to their own members; they can encourage (but not require) individual campaign contributions, registration, and voting; and they can target get-out-the-vote campaigns in support of particular candidates.
What about money? For charitable 501(c)(3) organizations, no contributions to candidates are permitted. For civic 501(c)(4) organizations, federal law prohibits direct contributions to candidates in federal races, but where state and local laws permit, civic groups may give cash and in-kind contributions to state and local candidates.
Spending money for "independent advocacy" on behalf of a candidate can bring a civic organization close to the line of permitted activities; the group must ensure that the decisions about how to spend money and when to do it are completely independent of the candidate’s political campaign.
Can you form a political action committee (or PAC)? PACs are described in Section 527 of the Internal Revenue Code; these groups solicit funds to support particular candidates. But PACs aren’t for everyone. For one thing, charitable 501(c)(3) organizations cannot form PACs, and they may not be associated by name, structure, or governance with a PAC without risking their tax-exempt status. The executive committee or the board of a charitable organization, for example, cannot decide to set up a PAC to support the goals of the organization.
Civic 501(c)(4) organizations and collective bargaining 501(c)(5) chapters can form either a PAC or what is called a "separate segregated fund" (SSF) to channel contributions to candidates. Groups of individuals can also form a PAC, provided that the PAC is not associated in any way with a charitable organization or a corporation. There are very specific federal and state laws governing the formation and the activities of PACs and SSFs; get good legal advice before going down this road.
The Alliance for Justice has published several excellent guides to help tax-exempt organizations support their causes (and, if possible, their candidates) within the law. For more information, write to the Alliance at alliance@afj.org.
Ruth Flower is AAUP director of public policy and communications.
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