Nonprofits touch millions of Californians every day, whether it’s seniors relying on services like Meals on Wheels, or families enjoying wilderness protected by a local land trust. But, a provision tucked into the House version of the tax reform bill has the potential to cause serious harm to nonprofits and the people who depend on them.
The House version of the tax reform bill would erode protections that prevent nonprofits from engaging in campaigns and electioneering.
Congressman Devin Nunes, R-Tulare, is the only Californian on the conference committee charged with reconciling the differences between the House and Senate versions of the tax bill, and he has an opportunity to ensure the final bill does not include this troubling policy.
Known as the Johnson Amendment, this section of federal tax law prohibits 501(c) (3) organizations from endorsing, opposing, or contributing to political candidates. In exchange for their tax-exempt status, and the ability to receive tax-deductible contributions, nonprofits agree to not engage in political campaigns or to support or oppose candidates for public office.
While the Senate’s version of the tax reform bill left the Johnson Amendment alone, the House version would weaken it.
Without the Johnson Amendment protections:
▪ Churches and other nonprofits would be pressured to endorse candidates for mayor, boards of supervisors, Congressmen and Senators in exchange for charitable contributions.
▪ Churches – because they do not have to disclose their donors – would be especially vulnerable as targets for dark money pass-throughs. Campaigns could take out billboards trumpeting which churches have endorsed their candidate.
▪ Elected officials would be tempted to funnel money to nonprofits that have endorsed them, and to deny them funding if they endorsed an opponent.
▪ Pop-up fake nonprofits – whose only purpose is to spend campaign cash and engage in electioneering – could become a real problem.
Weakening the Johnson Amendment would throw nonprofits into politics and electoral campaigns, instead of keeping their focus on their missions. In response, more than 200 California organizations have already weighed in with the California congressional delegation, urging our elected officials to leave the Johnson Amendment as is.
Nonprofits need to stay nonpartisan in order to play the essential roles we play in communities throughout our state. We urge Congressman Nunes to use his role as a conferee to ensure that changing or repealing the Johnson Amendment is left out of the final bill. Our communities are depending on him.
Jan Masaoka is CEO, California Association of Nonprofits (CalNonprofits). Bob Hand is Interim Executive Director, Resources for Independence in Fresno and Sopac McCarthy Mulholland,is president and CEO, Sequoia Riverlands Trust, Visalia.