Ballot Measures

On this episode, we cover a very specific type of lobbying that doesn’t necessarily seem like lobbying in the first place. Ballot measures can range from local bonds to state constitutional amendments, and everything in between. What can nonprofits do to support or oppose them, and how do they comply with state and federal law?     Our attorneys for this episode  Tim Mooney  Natalie Ossenfort  Quyen Tu    What are Ballot Measures?  Called different things in different states and localities  Bond  Constitutional Amendments  Referenda  Ballot questions / initiatives   Propositions  Any policy matter put to a vote of the general public    There are no federal ballot measures, but federal law has one major thing to say about measures for 501(c)(3)s  State and sometimes local laws cover campaign finance and reporting requirements    Can nonprofits take a stance?  No. End of episode. (just kidding!)  Most can. All 501(c)s that aren’t charities or foundations can (generally) do an unlimited amount of ballot measure advocacy, but must follow state and local laws for reporting their work  Public charities can take a stance, but ballot measures are lobbying (which is why this episode is in the lobbying series!). From there, they also have to follow state and local laws for reporting their work  Private foundations cannot take a stance on ballot measures (again...lobbying) without being hit with a big excise tax    Wait, lobbying? Tell me more.  Boil it down? Voters are a giant legislative body  Direct lobbying, not grassroots – and that’s good because charities can do more direct lobbying  Doesn’t violate the prohibition on electioneering to support or oppose measures because they are not related to candidates  Be careful to make sure your org’s advocacy isn’t seen as/tied to a candidate’s position on the ballot measures  Clock starts ticking when petitions go out to qualify for the ballot or (probably) when you’re lobbying legislative bodies when they are determining whether to refer an item to the voters  Count all prep work, staff time, communications costs, etc.  You non-c3s? Tax law doesn’t restrict lobbying, and this counts toward primary purpose activity... so load up on your GOTV and voter reg work on ballot measures and (strategy time!) it can offset candidate work you do.    State laws...  Every state is different, starting with the fact some states don’t have ballot measures at all. Even states without statewide ballot measures like NY have local bond measures though.  Any state or locality with ballot measures has some kind of registration and reporting laws  We have state law resources for your state! Examples:  Texas  Corporations (including nonprofits) can support or oppose ballot measures in Texas.  Texas Election Code defines a political committee as two or more persons acting in concert with a principal purpose of accepting political contributions or making political expenditures. Since the definition of “persons” includes nonprofit corporations and expenditures and contributions include those made in connection with a measure, it is possible for nonprofits to trigger PAC registration and reporting in Texas even if they don’t do any candidate-related work.  TRANSLATION: if a group of nonprofits comes together to raise funds for the support or opposition of a measure, they may need to register and report as a PAC.  It is also possible that if a nonprofit acts on its own to impact a ballot measure, it could trigger direct campaign expenditure (aka independent expenditure) reporting even if it doesn’t coordinate its work with other organizations or individuals. DCE reporting, as it’s sometimes referred to, kicks in when more than $100 is spent to support or oppose a measure.  Of course, there are other scenarios as well that might not require state-level reporting in the ballot measure context in Texas (e.g. nonprofit contributions to a ballot measure only PAC), so feel free to reach out to our TX team if you have any questions about when and what you have to report when you engage in ballot measure advocacy.  Oregon  Trivia: Oregon is one of the first states to adopt ballot measures... started them in 1902 (just behind SD and UT)  Five forms: state statutes (legislature or citizen referred), constitutional amendments (legislature or citizen referred), and veto referenda.  If your nonprofit’s purpose is to support/oppose a ballot measures you have to register as a political committee  No contribution limits (those are unconstitutional per SCOTUS)   Real time online reporting (ORESTAR!!!!)  3 reporting periods  Contributions over $100 - the name/address of the donor disclosed  California  These rules are about transparency and tracking money in CA elections.  Most important: if you engage in certain fundraising activities or spending, you could become a ballot measure committee and not even know it. That means your nonprofit would have filing and reporting obligations.  There just isn’t enough time to do justice to the CA BM rules on this show so if you’re interested in a whole show, please shoot us an email  Ballot measures are treated as campaign activity  Rules are designed so that when people or organizations accept or spend money for ballot measures, it gets reported by someone.  When there is advocacy for a ballot measure, there will be a main ballot measure committee. Must report contributions of $100+, whether financial or in-kind, and expenditures. This usually works best as a separate entity from a 501(c)(3).  Even if you are not the main ballot measure committee, there are ways NPs could trigger reporting with the FPPC  receiving or spending money on ballot measure advocacy  receive $2k+ in calendar year earmarked for ballot measures, you become a recipient committee. Recipient committees have to report their donors.  Another way to become a recipient committee is to spend at least $50k in non-earmarked donated funds. At these higher levels of spending it gets more detailed so please check out our resources.   Major Donor Committee: give $10k+ in calendar year to a recipient committee (staff time counts) but does not receive $ earmarked for ballot measures  Independent Expenditure Committee: spends $1k+ in a calendar year on communications that expressly advocates for/against ballot measures and not made in coordination with a ballot measure committee  Non reportable activities:  10% or less of staff time  Paid staff time counts as an expenditure, or if it’s coordinated with a ballot measure committee, a contribution. If you have staff spending more than 10% of their time in any calendar month on ballot measures, you need to consider that expenditure towards these thresholds.  Newsletter  Member communications  Contracted services to the ballot measure committee  Certain limited fundraising expenses  Raising money for the ballot measure committee where the contributions go directly to the ballot measure committee (funds do not pass through the org)   You can ask people to donate to the main ballot measure committee and only your fundraising costs would count as a contribution toward these thresholds, some fundraising costs are even exempt from reporting.  Final thoughts?  Often critically important advocacy  Private foundations! You can and should support this work, even though you cannot directly advocate or fund it. How?  general support grants  specific project grants for non-lobbying portions of the work  educate the public about the ballot measure process  communications that qualify as nonpartisan analysis  communications that are neutral urging voters to study the issue    Resources  Bolder Advocacy ballot measure toolkit  Seize the Initiative  Foundations and Ballot Measures  California Campaign Finance and Ballot Measure Guide  Ballot Measure Activities Exempt from California Disclosure Laws  Initiating Policy Change: Circulating Ballot Initiatives in California  Texas Campaign Finance and Ballot Measure Guide