JFA has received several requests for clarification of the

IRS lobbying regulations. The "Let America Speak! Coalition"

(Alliance for Justice, INDEPENDENT SECTOR, and OMB Watch offer

the following explanation of the 1976 Lobby Law:

"Let America Speak! members and other groups have asked for a

description of the 1976 lobby law that they can give to their

Board members, staff and others as they weigh the importance of

electing to come under the liberal provisions of that law.

Enclosed is a one page explanation and accompanying one pager

which describes a number of legislation related activities that

are not considered lobbying under the 1976 law. We urge you to

distribute the information broadly to your volunteer

leadership, staff, affiliates and other groups that lobby or

are considering lobbying. If you want additional information,

please contact any of our organizations listed below or Charity

Lobbying in the Public Interest, 2040 S Street, NW, Washington,

DC 20009; phone - 202/387-5048; fax - 202/387-5149; e-mail -

charity.lobbying@indepsec.org. Also, see below for a list of

publications related to lobbying and advocacy.

Nan Aron

2000 P Street, NW, #600

Washington, DC 20036

Phone: 202/822-6070

Fax: 202/822-6068

Matt Hamill

1828 L Street, NW, #1200

Washington, DC 20036

Phone: 202/223-8100

Fax: 202/331-8126

Patrick Lemmon

1742 Connecticut Avenue, NW

Washington, DC 20009

Phone: 202/234-8494

Fax: 202/234/8584

The federal government, including Congress and the

Internal Revenue Service, supports lobbying by charities.

Congress sent that unambiguous message when it enacted the

liberal provisions under the 1976 lobby law. The same message

came from the Internal Revenue Service in regulations issued in

1990, which support both the spirit and intent of the 1976

legislation.

The 1976 law is clear regarding what constitutes

lobbying by charities. Following are key points about that

legislation. They apply only to charities that have "elected"

to come under the 1976 law. Those that have not elected remain

subject to the ambiguous "insubstantial" test, which leaves

uncertain which activities of charities related to legislation

constitute lobbying and how much lobbying is permitted:

1. The most important feature of the law is that it

provides ample leeway for charities to lobby, and it protects

those that elect the advantages of the 1976 rules, from the

uncertainties they would be subject to if they remained under

the insubstantial test.

2. Generally, organizations that elect the 1976 lobby law

may spend 20% of the first $500,000 of their annual

expenditures on lobbying ($100,000), 15% of the next $500,000,

and so on, up to $1 million dollars a year! Equally important,

there are eight critically important legislation-related

activities which charities may conduct that are not considered

lobbying by the IRS.

3. Understanding what constitutes lobbying under the 1976

law is not difficult. In general, you are lobbying when you

state your position on specific legislation to legislators or

other government employees who participate in the formulation

of legislation, or urge your members to do so (direct

lobbying). In addition, you are lobbying when you state your

position on legislation to the general public and ask the

general public to contact legislators or other government

employees who participate in the formulation of legislation

(grassroots lobbying).

4. The Internal Revenue Service encourages groups to elect

to come under the 1976 law. The IRS has found groups that have

elected are more often in compliance with the law than those

that have not. Also, it is easy to elect. Just have your

governing body vote to come under the provisions of the 1976

law and file the one page IRS Form 5768 with the IRS. FOr a

copy of Form 5768, contact Charity Lobbying in the Public

Interest at charity.lobbying@indepsec.org or at 202/387-5048,

or download it from the Web site at www.indepsec.org/clpi.

--------------------------------------------------------

What Are the Main Elements of the 1976 Law?

Exclusions from Lobbying. Critical to the 1976 law are the

provisions declaring that many expenditures that have some

relationship to public policy and legislative issues are not

treated as lobbying and so are permitted without limit. For

example:

1. Contacts with executive branch employees or legislators

in support of or opposition to proposed regulations are not

considered lobbying. So, if your charity is trying to get a

regulation changed it may contact both members of the Executive

Branch as well as legislators to urge support for your position

on the regulation and the action is not considered lobbying.

2. Lobbying by volunteers is considered a lobbying

expenditure only to the extent that the charity incurs expenses

associated with the volunteers' lobbying. For example,

volunteers working for a charity could organize a huge rally of

volunteers at the state capitol to lobby on an issue and the

only expenses related to the rally paid by the charity would

count as a lobbying expenditure.

3. A charity's communications to its members on

legislation -- even if it takes a position on the legislation

-- is not lobbying so long as the charity doesn't directly

encourage its members or others to lobby. For example, a group

could send out a public affairs bulletin to its members, take a

position on legislation in the bulletin, and it would not count

as lobbying if the charity didn't ask its members to take

action on the measure.

4. A charity's response to written requests from a

legislative body (not just a single legislator) for technical

advice on pending legislation is not considered lobbying. So,

if requested in writing a group could provide testimony on

legislation, take a position in the testimony on that

legislation, and it would not be considered lobbying.

5. So-called self-defense activity -- that is, lobbying

legislators (but not the general public) on matters that may

affect the organization's own existence, powers, tax exempt

status, and similar matters would not be lobbying. For

example, lobbying in opposition to proposals in Congress to

curtail charity lobbying, or lobbying in support of a

charitable tax deduction for nonitemizers, would not be a

lobbying expenditure. It would become lobbying only if you

asked for support from the general public.

[Lobbying for programs in the organization's field,

(e.g., health, welfare, environment, education, etc.) however,

is not self-defense lobbying. For example, an organization

that is fighting to cure cancer could not consider working for

increased appropriations for cancer research to be self-defense

lobbying.]

6. Making available the results of "nonpartisan analysis,

study or research" on a legislative issue that presents a

sufficiently full and fair exposition of the pertinent facts to

enable the audience to form an independent opinion, would not

be considered lobbying. The regulations make clear that such

research and analysis need not be "neutral" or "objective" to

fall within this "nonpartisan" exclusion. The exclusion is

available to research and analysis that take direct positions

on the merits of legislation, as long as the organization

presents facts fully and fairly, makes the material generally

available, and does not include a direct call to the reader to

contact legislators. This exception is particularly important

because many nonprofits that engage in public policy do conduct

significant amounts of nonpartisan analysis, study and research

on legislation.

7. A charity's discussion of broad social, economic and

similar policy issues whose resolution would require

legislation -- even if specific legislation on the matter is

pending -- is not considered lobbying so long as the discussion

does not address the merits of specific legislation. For

example, a session at a charity's annual meeting regarding the

importance of enacting child welfare legislation, would not be

lobbying so long as the organization is not addressing merits

of specific child welfare legislation pending in the

legislature. Representatives of the organizations would even

talk directly to legislators on the broad issue of child

welfare, so long as there is no reference to specific

legislation on that issue.

8. It's not grassroots lobbying if a charity urges the

public, through the media or other means, to vote for or

against a ballot initiative or referendum. (It's direct

lobbying, not grassroots, because the public in this situation

becomes the legislature. Lobbying the public through the media

is therefore considered a direct lobbying expenditure, not a

grassroots expenditure. This is an advantage because charities

are permitted to spend more on direct lobbying than on

grassroots lobbying.)

>From the foregoing, it is very clear that there are many

activities related to legislation that do not count toward

lobbying expenditure limits.

LET AMERICA SPEAK! Coalition Co-Chairs

Alliance for Justice

Nan Aron

2000 P Street, NW, #600

Washington, DC 20036

Phone: 202/822-6070

Fax: 202/822-6068

e-mail: advocacy@afj.org

INDEPENDENT SECTOR

Matt Hamill

1828 L Street, NW, #1200

Washington, DC 20036

Phone: 202/223-8100

Fax: 202/331-8126

email: matt.hamill@indepsec.org

OMB Watch

Patrick Lemmon

1742 Connecticut Avenue, NW

Washington, DC 20009

Phone: 202/234-8494

Fax: 202/234/8584

email: lemmonp@ombwatch.org

--

Fred Fay

Chair, Justice For All