Both progressive and conservative advocacy groups are raising objections to new regulations proposed by the Obama administration to limit political activity by so-called social welfare organizations, the New York Times reports.
Organizations across the political spectrum have said new rules drafted by the U.S. Department of the Treasury and the Internal Revenue Service to disallow "candidate-related political activity" by organizations that are tax exempt under section 501(c)(4) of the Internal Revenue Code are too broad. Indeed, twenty-three thousand comments — a record — have been posted ahead of a February 27 deadline in response to the proposals. According to the Times, nonprofit advocacy groups fear that, under the expanded definition of "candidate-related political activity," enforcement of the regulations would chill a variety of civic initiatives, including voter registration efforts and candidate forums.
While criticism of the regulations by conservative groups was expected, liberal organizations such as the American Civil Liberties Union and the Alliance for Justice also have registered strong opposition to the proposals. Abby Levine, a lawyer with AFJ, told the Times that in attempting to crack down on organizations that are skirting the law, the government could make it impossible for any nonprofit to engage in political activity. "We could stop these abuses, but stopping all organizations to me is not a useful solution," said Levine. "Anything that makes it harder for people to get involved is disturbing."
Others told the Times that the proposed rules, while flawed, are a welcome step toward clarifying the kind of political activity tax-exempt groups are allowed to engage in and to clamping down on both right- and left-leaning organizations that are taking advantage of loopholes in the tax code to influence elections. "These are certainly imperfect rules, but the IRS has to figure out how you differentiate bona fide social welfare organizations from these phantom (c)(4)s that are doing nothing but abusing the tax laws," said Stephen Spaulding, counsel to public advocacy group Common Cause.
Indeed, in a letter to the House Ways and Means Committee, a coalition of campaign watchdog groups — including Americans for Campaign Reform, the Brennan Center for Justice, Democracy 21, and the Sunlight Foundation — argued that any delay in enacting the proposals "will only serve to prolong the opportunity for the abuses of the tax laws that have resulted in hundreds of millions of dollars of undisclosed 'dark' money flowing into federal elections."