January 13, 2000 | Read Time: 1 minute
The Alliance for Justice, a national association of advocacy groups, and 15 grant makers are asking foundations to encourage their grant recipients to consider a little-used way to have their lobbying work measured by the government.
Federal law has long allowed charities to lobby — provided that they can pass a test to prove that “no substantial part” of their overall activities focuses on influencing legislation. Because of the imprecise nature of that test, Congress enacted a law in 1976 that permits a charity to spend a set percentage of its total budget on lobbying. The I.R.S. issued regulations in 1990 that explain how the service is enforcing the law.
Charities that choose to be covered under the 1976 law and subsequent regulations must notify the I.R.S. of their decision to do so. Otherwise, they are still judged according to the “no substantial part” test.
Many charities have declined to adopt the approach under Section 501(h) of the 1976 law, because they don’t understand it, or are concerned that such a step might lead to an I.R.S. audit, create more paperwork, or upset their grant makers. To quash those fears, the Alliance for Justice has published a guide, “Worry-Free Lobbying for Nonprofits,” that it is making available at no cost to foundations to hand out to their grantees.
“Surprisingly, less than 3 per cent of eligible non-profits have made the election,” writes Nan Aron, president of the alliance, in a letter to foundations that is co-signed by 15 grant makers. “The effectiveness of your grantees and of the funding you provide them will be significantly enhanced, we believe, if they opt for 501(h) status.”
For more information, call Susan Hoechstetter of the Alliance for Justice, (202) 822-6070, or send her an e-mail message at shoech@afj.org.
