As we were doing research on nonprofits and public policy advocacy, we found that there was a political undercurrent in the dialogue that is very powerful and yet not often clearly expressed. This undercurrent has everything to do with how balanced the political dialogue in this country really is. This article by Karen Paget (a reprint from American Prospect) is unusually long for our publication but we thought it was critically important to our readers in gaining a full understanding of the issue. Paget examines the recent social history of nonprofit advocacy. She starkly contrasts the posture and success of conservative with more progressive efforts and we are left with a clear understanding of the pivotal importance of our attitude in approaching the public policy arena and the level of importance this realm of activity has for our sector.
Starting a new organization? You will very likely apply for a tax exemption from the IRS in order to attract foundation grants and gifts from individual donors. This decision, of course, has fateful consequences, especially for organizations devoted to social or political change. Accepting foundation funding means that you will have to limit your tactics and serve the foundation’s goals as well as your own—and the foundation may also be looking over its shoulder at the IRS and Congress.
Since most activist organizations are promoting changes that are, broadly speaking, political—changing public policies, political resources, and the very rules of the game—tax-exempt status tends to cramp their style. In one sense, this constraint seems only fair; other taxpayers should not be subsidizing, via tax exemption, groups whose goals they do not share. Yet what precisely is political? In reality the IRS gives nonprofit organizations wider latitude than many appreciate. Nonprofits that are tax exempt under Section 501(c)(3) of the revenue code (which allows private donors to take tax deductions for the gift and allows foundations to make grants) are nonetheless permitted to organize, to speak out on issues, even to lobby, as long as lobbying doesn’t consume a significant share of their activity. Tax-exempt groups organized under section 501(c)(4), whose donors may not take tax deductions for their gifts, may do an unlimited amount of lobbying.
Tax-exempt groups are not supposed to be explicitly partisan. Even so, however, the IRS recently reaffirmed the status of the Progress and Freedom Foundation, a 501(c)(3) which was closely affiliated with Newt Gingrich. Indeed the foundation’s support for Gingrich’s activity was the basis for the House Ethics Committee’s sanction of Gingrich. Tax-exempt groups have also sponsored voter registration drives, sometimes with implicit partisan objectives. And other groups with close partisan ties, such as the Democratic Leadership Council, have affiliates that are nominally nonpartisan 501(c)(3)s.
In fact, large activist organizations have long divided themselves into different segments. For instance, the Sierra Club is really an organizational complex. The Sierra Club Foundation is a 501(c)(3) organization that receives donor funds which are fully tax deductible; this category of organization may do only limited lobbying. The Sierra Club proper is tax exempt under a different section (501(c)(4)) of the tax code; it raises funds from supporters, who in this case do not receive a tax deduction—meaning the club is free to lobby without restriction. And, finally, the Sierra Club Political Committee, which is regulated primarily by the Federal Election Commission, receives contributions that are not tax deductible and may be used explicitly to support political candidates. An environmentally conscious citizen can participate in the full range of these Sierra Club activities, from issue development to lobbying to supporting specific candidates who reflect the organization’s agenda, notwithstanding the nominal distinctions among the club’s groups. Such conservative groups as the National Rifle Association and the National Right to Life Committee resort to the same devices. If the organization has a competent lawyer, it will pass IRS muster, even though the several units are closely related and share a common agenda, strategy, and, often, board of directors.
As John Judis (“The Pressure Elite,” American Prospect, Spring 1992), Theda Skocpol, Marshall Ganz, and others have observed, large civic organizations in recent years have become increasingly reliant on philanthropic dollars rather than resources from their members or constituents. Nearly a decade ago, in the second issue of the American Prospect, I explored how dependency on foundation funding fosters competition, over-specialization, and issue fragmentation. (See “Many Movements, No Majority,” Summer 1990.) There are two additional consequences: first, dependence on organized philanthropy depoliticizes progressive community groups; and second, the new right is striving to hobble the nonprofits of the liberal left while remaining more politically assertive than the left with its own nonprofits.
Lately, both foundations and the community groups they sponsor have been in a lather over something called “advocacy,” a term that is nowhere in the tax code but which seems to strike fear into the hearts of funders. More precisely, it tends to worry moderately liberal and centrist funders. The idea that nonprofit donors and grantees should be wary of something called advocacy is in fact the result of a highly successful campaign of intimidation by the political right.
“Advocacy,” as a pejorative, reflects a two-decade campaign to defund the left, as originally expressed in a famous 1981 Heritage Foundation tract. It is somewhat ironic that conservative foundations and the activist groups they sponsor are simultaneously highly aggressive about challenging the legitimacy of their liberal counterparts and far bolder about pressing the limits of what they themselves can legally do in the realm of organizing, advocacy, and even explicit lobbying. (See “Lessons of Conservative Philanthropy,” American Prospect, September-October 1998.) For example, the Heritage Foundation, which claims political credit for everything from the balanced budget to the fall of the Berlin Wall, simply declares that everything it does is merely public education and that nothing it does should be construed as lobbying. A typical disclaimer: “Nothing written here is to be construed as necessarily reflecting the views of the Heritage Foundation or as an attempt to aid or hinder the passage of any bill before Congress.” That seems to satisfy the IRS.
Large centrist foundations tend to be more gun-shy about supporting activist groups, in part because of fears (often exaggerated) about IRS or congressional retribution, and in part because their boards usually include business leaders who may not be enthusiastic about financing activist causes. Blaming the IRS is good cover for denying a grant to an activist group. As a sign that this controversy has hit the mainstream, the Council on Foundations last year at its annual meeting hosted several panels on advocacy, including one entitled “Advocacy is Not a Four Letter Word.”
But what, really, is advocacy? Is foundation and grantee fear of congressional investigations and IRS audits warranted? Why aren’t corporations and conservatives also concerned that they might violate IRS regulations governing tax-exempt activity, especially lobbying? After being on the defensive for many years, some grantees and foundations are beginning to challenge funder timidity on this question. This is a good moment to sort out the relationships among advocacy, philanthropy, and progressive political strategy.
Although the controversy over what kind of advocacy foundations should support is often framed as a legal question, neither the 1969 Tax Reform Act nor its 1976 amendments governing tax-exempt organizations use the word “advocacy.” Nor was “advocacy” one of the 26 categories originally identified in the late 1970s by the Independent Sector, an association of nonprofit organizations, in its taxonomy of nonprofits. As late as the Carter administration, “public interest” was the term of art used to describe citizen organizations and social-action groups.
The right aimed to change that. Reagan-era conservatives hated the rhetoric of “public interest” used by liberal groups, with its elevation of “public” over “private” claims and its mantle of altruism. The Heritage Foundation’s 1981 agenda for the Reagan administration, Mandate for Leadership, suggested two key objectives with regard to liberal groups: to break the “moral monopoly” implied by “public interest” claims, and to cut off government support of such groups. Heritage authors placed the word advocacy in quotation marks and it soon gained widespread usage. For some, advocacy means lobbying. For others, it means just about any activity that involves government agencies, legislatures, public policy, community organizing, or other forms of citizen mobilization. But the charge of advocacy has been enough to intimidate some mainstream foundations.
The conservative campaign to create a broad new class of prohibited activities, called “political advocacy,” gained new momentum after the Republicans took control of Congress in 1994. An amendment first introduced in 1995 by Representative Ernest J. Istook, an Oklahoma Republican, proposed prohibiting any organization that received federal funds from engaging in any advocacy activity. The argument was that money is “fungible,” so restrictions on federal funds just free up other money with which to “advocate.” Istook’s proposed “Stop Taxpayer Funded Political Advocacy” bill not only would have prohibited most interaction with government officials; it also would have given private citizens legal standing to challenge the activity of any nonprofit in court. The burden of proof—demonstrating that the nonprofit did not engage in suspect behavior—would fall on the nonprofit, not the accuser.
Istook, unintentionally, inspired a stunningly broad opposition coalition of nonprofits, most of them anything but radical, who agree on little else. The ad hoc coalition, called Let America Speak, included over 300 nonprofits, ranging from entire professional associations such as the Council on Foundations and the Independent Sector, to large mainstream organizations that included the Girl Scouts, the United Way, and Mothers Against Drunk Driving, to more liberal organizations. While the Istook amendment passed the House on August 3, 1995, the coalition effectively advocated to keep it from passing the Senate. However, similar amendments are regularly attached to appropriations bills and even, last year, to the campaign finance reform bill.
In the meantime, foundations and their grantees have rather more latitude than they often admit. The Alliance for Justice has undertaken a major program to translate advocacy in terms of IRS regulations, and has drawn on the top tax-exemption attorneys throughout the country for assistance, including Thomas A. Troyer of the law firm of Caplin and Drysdale and John A. Edie of the Council on Foundations. Thomas Asher, for instance, in his Alliance for Justice report Myths v. Fact: Foundation Support of Advocacy, distinguishes between three types of advocacy: 1) partisan electoral activity, which is prohibited for foundations and grantees alike; 2) legislative lobbying, which is permitted but regulated; and 3) everything else, which is essentially unregulated.
The Alliance for Justice has made a long list of permissible activities for 501(c)(3) public charities: they may “engage in limited lobbying, including ballot measure advocacy; conduct public education and training sessions about participation in the political process; educate candidates on public issues; publish legislative scorecards (with certain restrictions); prepare candidate questionnaires (with certain restrictions); canvass the public on issues; sponsor candidate debates (with certain restrictions); advocate in connection with party platform issues; rent mailing lists and facilities at fair market value to other organizations, legislators, and candidates (with certain restrictions); conduct nonpartisan get-out-the-vote voter registration and education drives; establish a 501(c)(4) [to lobby more extensively].”
Yet despite the defeat (for now) of the Istook amendment, large foundations remain wary of advocacy. They have been burned before. Even before the conservative-led “defund the left” campaign gained strength, the expansion of citizen participation that occurred in the 1960s ran into a wall of bipartisan resistance that chills philanthropic attitudes today.
In the 1960s the premier supporter of community organizing was not organized philanthropy, but the federal government—through its War on Poverty, including legal services, Head Start, community action agencies, Volunteers in Service to America (VISTA), and similar programs. In many counties in the Deep South, Head Start instantly became the largest employer not accountable to the local white elite. In the urban North, community action programs funded by the Office of Economic Opportunity underwrote a parallel local politics.
These programs threatened local power structures. Long before Nixon tried to kill them entirely, these programs were partly neutralized by Democrats after fierce opposition from mostly Democratic local elected officials. In a series of amendments in the late 1960s, Community Action Agencies were put under City Hall’s control; governors were given “check-offs” before federal programs such as VISTA could operate locally; and only a few antipoverty programs, such as Head Start, retained direct federal funding.
Foundations also underwrote adjuncts of the War on Poverty, like the first generation of public interest law firms and coalitions such as the Citizens Crusade Against Poverty. In a gesture that particularly infuriated congressional conservatives, the Ford Foundation in 1968 gave generous readjustment fellowships to eight prominent staffers of the martyred Bobby Kennedy. The civil rights movement was also exercising its newfound muscle through voter registration drives, which had begun in the early 1960s; largely underwritten by liberal foundations, these drives proved increasingly threatening to congressional incumbents. As the decade ended, foundations were summoned to explain themselves before congressional committees.
The 1969 congressional hearings, which were extremely acrimonious, resulted in the 1969 Tax Reform Act, creating the current regulatory framework. It was a traumatic event in foundation history. It added a specific provision prohibiting lobbying and political activity by private foundations. (A private foundation is a nonprofit group that gets its money from one or a small number of individuals, a family, or a corporation, such as the Ford Foundation. It can be a grant-making entity, or can operate charitable programs directly. The other kind of 501(c)(3), a public charity, gets support from multiple sources.) For the first time, Congress imposed a four percent tax on investment income, subsequently reduced to two percent. It added specific payout requirements, compelling foundations to disburse at least five percent of their assets in annual grants. It imposed new limits on conflicts of interest. And it added a separate set of rules for foundations and grantees engaging in voter registration, intended to prevent narrow electoral targeting.
Waldemar Nielsen, an eminent observer and critic of foundations, wrote that the experience “left most of the prominent figures in philanthropy in a state of panic, almost terror.” Indeed, fear of congressional hearings and new restrictions is part of the collective DNA of the foundation community, passed on as a cautionary tale to successive generations of program officers. To this day, for example, voter registration remains a legitimate tax-exempt activity subject to certain legal requirements, but many foundations are reluctant to venture anywhere near registration activities. In subsequent 1976 legislation, Congress clarified the rules to explicitly allow public charities to engage in some lobbying, subject to a budgetary formula, which can be as much as 20 percent of an organization’s budget.
Since 1969, foundation skittishness has been reinforced by repeated congressional attacks on federal programs, which have signaled what’s acceptable to Congress. President Nixon, for example, abolished the Office of Economic Opportunity; and while he didn’t succeed in completely killing all of its programs, Congress placed new restrictions on legal services, community action, and VISTA that prohibited most forms of organizing or community mobilization. Resources were reshuffled into direct services. Ministering to the needy, one by one, was no political threat. The underlying, genuinely divisive issue was whether community groups, with public funding or tax-exempt foundation support, would retain the capacity to go beyond ameliorative strategies—to politics, partisan or otherwise.
The Carter administration represented both a brief respite and a resurgence of support for such programs. Many agencies established funding relationships with citizen and public interest groups, giving them a new legitimacy. It was this resurrection that so infuriated the Heritage-based conservatives, who would develop the defund the left” campaign of the 1980s. (This selective indignation did not prevent the subsequent Reagan administration from funding the right.)
An episode during the Carter administration, thought seemingly bizarre and sui generis at the time, turned out to be a preview of the next two decades. Then–VISTA Director Margery Tabankin tried to return VISTA to its community organizing roots, and away from its Nixonian focus on services. In preparation for new regulations, Tabankin and other ACTION officials (VISTA’s parent agency) invited roughly 100 community-based citizen organizations to Washington, D.C., to comment on the new regulations. Congressman John Ashbrook, seconded by House Minority Leader Robert Michel, charged ACTION officials with criminal conspiracy. While the charges were spurious, the McCarthy-style hearings, (“When did you meet…?” and “How long have you known…?”), though chaired by a Democrat, Paul Simon, tied the agency up for months and effectively ended any major expansion of VISTA. Congressional anger over support for such activities was not lost on the philanthropic world.
The thick record from the VISTA hearings also provided fodder for the initial “defund the left” campaign, containing as it did dozens of “suspect” organizations and their relationships with one another. The next step was to develop a more coherent ideological rationale for cutting off support for citizen groups. As the Heritage report put it: “Unless conservatives can break the moral monopoly still enjoyed by persons indifferent to the well-being of the American private sector and by proponents of expanded government power, any effort to reform federal domestic policies is likely to be reduced to the level of tinkering.” The Reagan administration began to translate the Heritage recommendations into action. The Office of Management and Budget general counsel, Michael Horowitz, prepared an amendment to executive order A-122, which regulates cost allocations for nonprofit organizations receiving federal support. He created a new classification, “political advocacy,” which was defined as “attempting to influence a government decision.” The amended order would have applied to any level and any branch of government and the prohibition would have applied not only to federal funds but also to any non-federal funds the organization might receive, whether from members or organized philanthropy. A firestorm of opposition erupted. For nearly three years, the National A-122 Coalition of nonprofit, religious, and other charitable organizations fought repeated iterations of the order.
“We won and we have won repeatedly, but we might as well have lost,” observes Gary Bass, director of the group OMB Watch, which has been involved in this and kindred conflicts. “Both federal grantees and foundations are living with the belief that A-122 is still around. To this day, people—including reporters—believe that organizations receiving federal funds have lost all their ability to lobby.”
Lester Salamon, a longtime scholar of nonprofits who is now at Johns Hopkins University, cautions against seeing efforts like A-122 and the Istook amendment exclusively in terms of the ongoing effort by conservatives to defund liberal activist groups. He argues that the Istook amendment was part of a much broader attack on the legitimacy of nonprofits; that corporations have realized that profit potential exists in nonprofit activities, especially in health care, child care, and education, creating a commercial interest in diminishing government subsidies. It would not be the first time that ideological conservatives have picked up support from their corporate brethren for entirely different political reasons. Significantly, the proposed Istook restrictions affected only grants, not contracts, thus leaving defense contractors and other large for-profit enterprises with federal business free to lobby the government. Since the defeat of his bill, Congressman Istook has continued to attach riders to targets of opportunity—“Istookettes” as Gary Bass calls them—including appropriations bills and even the campaign finance reform bill. The only thing that has saved the nonprofit community to date has been its enemies’ inability to divide the community into “good” nonprofits and “bad” nonprofits.
However, conservatives seem to have effected in practice what they couldn’t accomplish in Congress. Alliance for Justice Director Nan Aron, whose Nonprofit Advocacy Project trains organizations in tax-exemption requirements, agrees with Bass that these fights have created a difficult ideological environment. “Conservatives have tried to make the term ‘advocacy’ synonymous with ‘left-wing,’” she says. In this environment, distinctions among prohibited activity, regulated and unregulated, tend to collapse, and fear takes over.
Gail Harmon, a tax-exemption specialist who has worked with the Alliance for Justice, argues that IRS regulations remain “quite generous,” and that “there is no question but that fear is far greater than the [legal] restrictions.” This fear affects foundations and grantees alike. For instance, private foundations are forbidden to lobby, but may support organizations that do. A tax-exempt 501(c)(3) organization that wishes to do more than “insubstantial” lobbying may elect to spend up to 20 percent of its income by filing a simple form with the IRS. Yet, private foundations continually place written restrictions on grantees far greater than the law requires.
According to most tax-exemption specialists, all private foundations really need to say for their own protection is “this grant is not earmarked for lobbying.” Grant agreements, however, are more likely to contain a version of the following language:
“Grantee shall not use any portion of the funds granted herein to carry on propaganda or otherwise to attempt to influence specific legislation, either by direct or grassroots lobbying.” Grant-making organizations that qualify as public charities have even more freedom than private foundations to engage in and support lobbying, but even they have been known to use the same restrictive language. The end result is that both public and private foundations end up treating lobbying as if it were an illegal, rather than a perfectly legal, though regulated, activity. While we lack any kind of decent empirical base about lobbying activities, one statistic recently released by the IRS should give pause to anyone who thinks organizations are engaging in wholesale flouting of the law. Out of 200,000 charities that reported, less than 2 percent of nonprofits applied to exercise their right to lobby.
What makes this fear so interesting is that the penalties for transgression fall on the recipient, not the foundations, unless there is some sort of collusion. The penalty for foundations if they innocently support an organization that exceeds its lobbying limit?
Harmon says emphatically, “Absolutely none.” The penalty for an offending organization is not especially onerous either. An organization would pay an excise tax penalty according to an IRS formula. Informal penalties, however, could be more severe: a transgressing organization would argue that its reputation would be shot and its ability to raise further funds damaged.
Thus, a vicious circle ensues. Foundation officials point to Congress and their lawyers or to timid grantees to explain any chill in the air. Grantees return the favor by pointing to nervous funders. If a number of organizations had lost their tax-exempt status, or had otherwise been punished for lobbying, the chilly climate might be understandable. There is simply no evidence that this is happening. All longtime observers of the foundation and nonprofit world say that they know of no instance in recent history of an organization losing its tax exemption, or even being fined, for lobbying.
Consider what this reluctance to lobby really means. Because of this chilly climate, most nonprofits, including the dreaded “advocacy groups,” do not support specific legislation. But how can progressive policies be enacted if the interpretation of permissible behavior is limited to bland issue education? Those who followed the Clinton health care fight closely will remember the administration’s frustration with organizations that ran ads supporting health reform in general but couldn’t or wouldn’t take a position on the Clinton bill. By contrast, industry-backed ads, such as the famous Harry and Louise series, obviously were not so constrained. The nonprofit sector can never match the corporate sector in lobbying expenditures. Indeed, the resource disparity itself makes the need for greater organizing, and different forms of organizing, imperative.
Seemingly, one solution is for more 501(c)(3) organizations to establish 501(c)(4) affiliates that allow unlimited lobbying—akin to the relationship between the Sierra Club Foundation and the Sierra Club. However, many organizations do not opt for a 501(c)(4) because it requires committed members and donors to write checks that are not tax deductible. Recall that a 501(c)(4) gives the organization a tax break, but not the financial contributors. Relying on the (relatively) easier tax deductible money makes building substantial membership or constituency-based organizations unnecessary.
The pressure from conservatives is not likely to stop. No one believes that the spirit of Istook is dead. But after years of being on the defensive, a few supporters of nonprofits have encouraged philanthropists and activists alike to operate within the full extent of the law. Bob Smucker, former vice president of the Independent Sector, has started a project called Charity Lobbying in the Public Interest. “I know the name is awkward,” says Smucker, “but I wanted people to have to say the words ‘charity’ and ‘lobbying’ in the same sentence.” Smucker says he was motivated in part because organizations “are just scared to death of the IRS.”
The Alliance for Justice, which has produced readable training manuals for foundations and nonprofits on specific topics like advocacy and ballot initiative participation, is also preparing an omnibus booklet called The Connection that spells out in detail what 501(c)(3), 501(c)(4), and political action committees can do individually and in coalition. While there is no empirically based reason to assert that fear of the IRS inhibits coalition formation, it is logical to assume that it does.
Pablo Eisenberg, a longtime advocate of more aggressive social change philanthropy, recently suggested to an Aspen Institute meeting on nonprofits that all lobbying restrictions be taken off advocacy groups. His proposal met with support from some of the right’s leaders (who already behave as if no restrictions exist). He has an ally in Lester Salamon, who argues that “the existing restrictions on the advocacy activity of nonprofit organizations, far from being tightened, . . . may need to be significantly relaxed to allow nonprofit organizations to respond to the new citizen demands for involvement that now exist, and that should exist in a robust democracy.”
Changing the current culture of cautiousness is an important goal, even if the current political climate is inhospitable. Another goal, however, should be to examine our philosophical and conceptual understanding of nonprofit and “advocacy” groups.
After all, “nonprofit” is just a term for a structure through which myriad kinds of activity take place. If we focus more on role or function, what conceptual frame is appropriate? The frame of Tocqueville and voluntarism? Interest groups? Social movements? Mediating structures? Civil society?
None of the literature ever seems to consider what happens when theory is transformed into practice through the prism of the Internal Revenue Service. Even though IRS rules are more tolerant than many philanthropists believe, the mélange of congressional saber-rattling, IRS worries, and cautious foundation boards damps down activism. The thrust of the overall system in which philanthropy operates, therefore, is to keep activist organizations largely separate from electoral politics and to inhibit other forms of political participation. Yet Americans are concerned about low levels of political participation. Why not think of advocacy groups as a crucial link between the citizen and the polity? Why not foster this link rather than curtail it?
Philanthropy can be enormously creative, taking risks that others can’t or won’t take. Its leaders should certainly work to reclaim and reframe public policy advocacy and organizing work. However, even the most creative and aggressive use of philanthropic resources won’t change the fact that philanthropy and politics remain uneasy partners. Philanthropy can and should support advocacy. But advocacy should not depend on philanthropy.
Two recent legal rulings on tax-exempt activity demonstrate that conservatives are not afraid to push the limits of the law, even when their activities fall close to the partisan line.
Former Republican Congressman Jack Kemp tried to establish a tax-exempt 501(c)(3) organization to help flog his flat-tax proposal. The IRS denied his application, and Kemp sued. Last December, the U.S. Circuit Court of Appeals for the District of Columbia upheld the IRS denial on the grounds that the organization’s goals could be achieved through one means only—legislation. Conservative ally Leslie Lenkowsky fumed in a Wall Street Journal editorial that “if the IRS decides to enforce the standard it applied to Mr. Kemp’s organization, it will have little choice but to revoke the 501(c)(3) status of many other groups as well.”
According to tax-exemption specialist Mike Trister, however, the court’s ruling was really very narrow, and not one that significantly altered the scope of permissible activity. Indeed, as the court noted, Kemp’s group could have applied to be a 501(c)(4) organization if it wanted to achieve its ends exclusively through legislative lobbying. Kemp, like many others, has a logical preference for funds that are tax-exempt to the donor, not just to the organization. But Kemp refused to take “no” for an answer. He immediately challenged the IRS.
The other ruling involves the now-famous, Newt Gingrich–sponsored Progress and Freedom Foundation, through which Professor Gingrich taught courses on American government and developed a network of aspiring activists. Two years ago, the House Ethics Committee found that Gingrich had used tax-free money inappropriately, and the House fined him $300,000. On February 3, 1999, the IRS issued a Technical Advice Memo during an audit of the same organization, and ruled that the political benefits Gingrich received were “incidental” to the chief purpose of his courses, which were educational. (The IRS did say it was a “close call” and noted that the Ethics Committee had withheld documents from them that might have altered their opinion.) Conservatives in Congress are now pressing for a repayment of the $300,000 fine.
The Christian Coalition, by contrast, has had its application for 501(c)(4) status delayed, and has been the object of litigation based on an alleged pattern of coordinated support for Republican candidates, though the suit is based on Federal Election Commission rules, and not IRS standards. Recently, one church actually lost its tax-exempt status because of flagrant partisan electioneering. Clearly, however, the IRS is a lot more tolerant of tax-exempt activities, even those linked to electoral activity, than a lot of people think.
Reprinted with permission from the American Prospect, Number 44, May-June 1999. Copyright 1999. American Prospect, P.O. Box 772, Boston MA 02102-0772. All rights reserved.
Karen M. Paget is a political scientist with thirty years of experience in government, philanthropy, and academia. As a contributing editor