Should a Nonprofit Have to Disclose Campaign Expenditures?

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March 20, 2011; Source: Lincoln Journal Star | Americans for Progress is a conservative 501(c)(4) that NPQ has written about regarding its significant role in promoting the national Tea Party movement. During the 2010 election, the Virginia-based AFP had advertisements sent to voters offering information about Nebraska state senator Danielle Conrad. The messages weren't complimentary to the senator, including, "Danielle Conrad has raised taxes on every family and business in Nebraska . . . Roughly 1,000 more Lincoln residents are searching for a job today than when Danielle Conrad took office."

The Nebraska chapter of Common Cause thinks that AFP's actions against Conrad and others qualify it to disclose how much money it spent on the anti-Conrad mailings, just like the disclosure required of PACs and candidates themselves under Nebraska state law. However, AFP believes that the wording of its ads and mailings were "educational" because they did not specifically ask people to vote against Conrad or for her opponent.

Some Nebraska politicians believe that AFP is simply dancing around the law and its expenditures should be reported. Another state senator from Lincoln has introduced legislation to incorporate federal disclosure standards into state law to ensure that AFP would be required to report on this kind of activity in the future.

Although based in Virginia, groups like AFP are in a way located not in any particular jurisdiction, but located in their big special interest donors, unleashed and spurred on by the Citizens United decision of the U.S. Supreme Court that we have covered extensively here at NPQ.

In this case, AFP is neither in Nebraska nor in Virginia, but instead tied to its major funders such as the conservative Koch brothers. The barriers to transparency and accountability when it comes to electioneering "are distorting political campaigns to the point that public trust is lost," said Jack Gould, spokesman for the Nebraska chapter of Common Cause. Nonprofits are going to have to reconsider some aspects of their confidentiality rules if this nation is going to have any chance of making significant progress in campaign finance reform.—Rick Cohen