Latest Developments:
The United States Treasury Department announced that it will no longer require the names and addresses of donors to be included on Schedule B, which is filed with IRS Form 990, for any nonprofit other than a charity (501(c)(3) organization) or PAC (527 organization). For example, nonprofit social organizations that engage in political speech and register under IRC Section 501(c)(4), such as ballot measure committees, will no longer disclose the names and addresses of their donors. Filers will still disclose each contribution of $5,000 or more received without names and addresses. The changes are contained in Revenue Procedure 2018-38 and will apply to tax years ending on or after December 31, 2018.
The California Fair Political Practices Commission met Thursday, July 19, 2018, with the following results:
- New Chair Alice Germond expressed three goals: (1) to hold more meetings around the state, outside of Sacramento; (2) to partner with educational institutions and public groups with interest in the Commission; and (3) to continue the streamlining process, making things simple and clear for individuals who want to run for office.
- The Commission voted to withdraw the Andrews advice letter, which required charities who have contributed restricted funds to nevertheless be listed as a top donor, and instead create a regulation on this point as to when a top donor may be omitted.
- The Commission announced the appointment of a chair for its task force concerning enforcement.
- The Commission voted to support AB 2689, which prohibits legislative contributions by appointees subject to legislative confirmation. It deadlocked on support for AB 84, a bill about legislative caucus committees (see below).
The San Francisco Ethics Commission meets Friday, July 20. The Commission’s agenda includes a discussion of staff proposals for regulations regarding requests for opinions.
Reminder: August 1 is the PLI One-Hour Briefing on the “Basics of the Federal Election Campaign Act 2018.” You can sign up at the Practising Law Institute.
In case you missed it:
- Politico reports that the Treasury Department is on the defensive over its decision to stop collecting donor information. (See above.) The department says it doesn’t use the information, the collection of which dates to the Nixon administration. Critics say it eliminates transparency and the ability to follow the money.
- Rollcall has reactions to the Treasury’s new Revenue Procedure from both sides. On one side, Sen. Mitch McConnell said that the existing government collection of data can “chill political speech and invite harassment of citizens.” At the other end of the spectrum, Sen. Jon Tester called the move, “the swampiest, darkest, dirtiest decision.”
- The Campaign Legal Center issued a summary of Supreme Court Nominee Brett Kavanaugh’s stance on campaign finance issues. “(H)e would expand the power of big money in politics,” according to the article. The Institute for Free Speech responded with its own analysis castigating the CLC, and noting that Judge Kavanaugh’s opinions, “generally gave the First Amendment a robust interpretation protective of individual rights.”
- New Ways to Give: California Assembly Bill 84 was gutted on July 5, and new provisions were inserted. The newly amended bill would permit each party in each house of the legislature to establish a “caucus committee” with the same contribution limits as a political party committee. Politico reports that state Democratic Party officials fear the move will dilute their power, saying that the bill would “untether some campaign cash from the party endorsement system.” The bill would permit legislative leaders to control more campaign cash.
- Ouch: The Security and Exchange Commission fined Sofinnova Ventures, a bioscience investment firm, $120,000 for a $2,500 contribution made by one of its employees that violated the SEC’s pay-to-play rule. Pensions & Investments reports that the Illinois Teachers’ Retirement System had invested some $45 million in Sofinnova funds and the firm had a contract to provide investment services to the System when one of its employees made the contribution to a candidate for Governor, who subsequently won.