Will the Obama Administration’s Plan to Clamp Down on Trade Associations Hurt Nonprofit Advocacy?

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November 2, 2011; Source: Politico | Trade associations, through the association of associations known as “ASAE: The Center for Association Leadership,” are protesting against an Obama Administration proposal to restrict “government employees from attending educational programs, trade shows and similar events conducted by nonprofit organizations and trade associations.” (Note: Government employees would be permitted to attend trade association events if they are speakers or presenters; the rule is to prevent trade associations from wining, dining, and otherwise getting valuable off-the-record face-time with government officials.)

Sources affiliated with ASAE told Politico that they have a “very aggressive, well-conceived strategy” to “fight this ill-advised rule.” Apparently, a letter has been sent out to ASAE members urging them to gin up their activism against the Obama Administration rule. The letter was co-signed by ASAE president and CEO John Graham IV, American Beverage Association president and CEO Susan Neely, National Retail Federation president and CEO Matthew Shay, and American Frozen Food Institute president and CEO Kraig Naasz.

Sounds like a nonprofit advocacy-rights question, right? These associations are nonprofits—501(c)(3)s, 501(c)(4)s, 501(c)(6)s—and that makes this a nonprofit issue? Well, there are nonprofit associations that are trade associations for nonprofits and there are nonprofit associations that are trade associations representing interests that are distinctly not nonprofit. Just look at the last few days of news about trade associations trying to influence legislators and government employees; the recent lobbying-disclosure reports reveal some energetic activity on the part of a litany of nonprofit trade associations:

The official lobbying expenditures don’t include the unofficial face-time influencing that occurs through government officials and lobbyists attending the trade association seminars, meetings, and conferences. In Washington, DC, hotels such as the Marriott Wardman Park, the Omni Shoreham, and the Mayflower—common venues for trade association events—lie within easy access for a large number of government officials. Criticism of the Obama proposal suggests that government officials will lose out on educational opportunities and industry information if they don’t attend these trade association meetings. 

Will the Obama Administration’s proposed restriction unnecessarily harm nonprofit advocacy and outreach? Or has the Administration tried to close a door with inroads into the unregistered lobbying of business industry associations?—Rick Cohen