Citizens United: What Now?

On January 21, 2010, the Supreme Court issued a controversial, 5-4 opinion in Citizens United v. FEC, a case that will greatly impact nonprofit advocacy activities.   

While much of the focus has been about increased spending by for-profit corporations, these changes also apply to issue-based organizations that promote the social good.  More than ever, nonprofit corporations can and should actively participate in elections.  Even if you think the case was wrongly decided, 501(c)(4)s and other nonprofit corporations (except for 501(c)(3)s) should take advantage of it—use it to strengthen democracy by increasing your public communications about the candidates and what's best for the future of our country. 

Alliance for Justice is committed to providing nonprofits with the information needed to navigate this new legal landscape.  Check out our resources…more will be coming soon.

UPDATES   

Legislative Updates

• On April 29th, the Senate introduced legislation in response to the Supreme Court's decision in Citizens United called the DISCLOSE Act ("The Democracy Is Strengthened by Casting Light On Spending in Elections Act").  Click here to read the full text of the bill, as introduced. The House has introduced a similar bill.  Click here to read the full text of the bill as introduced in the House.
• The Congressional Research Service recently released a report providing an overview of selected campaign finance policy options that may be considered by Congress to respond to the Supreme Court's decision in Citizens United. The report also comments on how Citizens United might affect political advertising.  This report is available here: http://assets.opencrs.com/rpts/R41054_20100201.pdf. 

Regulatory Updates

• Hear Michael Trister testifying on behalf of Alliance for Justice at the FEC’s March 2-3 hearing on proposed regulations concerning coordinated communications, after Citizens United.  http://www.fec.gov/audio/2010/20100302_02.mp3.  Our written comments are available at http://www.fec.gov/pdf/nprm/coord_commun/2009/alliance_for_justice_and_afl-cio.pdf.

• Updated guidance from the FEC on operating Nonconnected PACs 

• Updated guidance from the FEC on operating Connected PACs 

• The Federal Election Commission announced that, "due to the Supreme Court's decision in Citizens United v. FEC," it will "no longer enforce statutory and regulatory provisions prohibiting corporations and labor unions from making either independent expenditures or electioneering communications."  While Citizens United did not directly address labor unions, we presumed the FEC ultimately would not treat unions differently from corporations, and FEC's announcement Friday confirms our assumptions.  In its announcement, the FEC also described various steps it is taking to conform with the decision, including various rulemakings.  Read the FEC's full announcement at:  http://www.fec.gov/press/press2010/20100205CitizensUnited.shtml.  

State Law Updates

• Citizens United applies to state and local election laws as well as federal elections—so states and localities with laws that prohibit "independent expenditures" or "electioneering communications" by corporations or unions will need to change their rules to comply with the Supreme Court’s directive.  For the latest on how your state is responding to the Supreme Court's decision on Citizens United, click here. 
• For the impact of Citizens United on electoral activities in California, click here. 

What Does Citizens United Do: Key Aspects

• It does not impact 501(c)(3)s.  Regardless of the changes in election law, the federal tax law that prohibits 501(c)(3)s from supporting or opposing candidates still apply.  501(c)(3)s still cannot endorse candidates or make independent expenditures suggesting who is the "better" candidate. 
• It does not allow corporations to make monetary or in-kind contributions directly to candidates for federal office or to coordinate communications with candidates.  The prohibition on corporate contributions to candidates and coordinated communications remain intact.
• It allows corporations, including nonprofit corporations such as issue-based 501(c)(4)s and 501(c)(6)s, to make independent expenditures containing express advocacy using the corporation's general treasury funds to support or oppose candidates for the U.S. House, U.S. Senate, and President.  However, nonprofit corporations remain subject to federal tax law, including a primary purpose restriction (political activities cannot be the primary purpose of a 501(c)(4), 501(c)(5), and 501(c)(6)) and possible tax on political activities.
• It allows corporations to make "electioneering communications." 
• Although corporations may now make independent expenditures and electioneering communications, they must comply with existing disclosure and disclaimer requirements.

What Does Citizens United mean for nonprofits?

• Frequently Asked Questions about Citizens United (pdf)
• FEC Disclaimer and Disclosure Requirements (pdf)
• Avoiding Coordinated Communications (pdf)
• LISTEN TO BRIEFING by experts on Citizens United (mp3)
• DOWNLOAD a chart that provides a broad overview of what each type of tax-exempt entity may now do.  AFJ is in the process of developing a list of Frequently Asked Questions and more detailed information about specific activities. 
• AFJ Fact Sheet on Citizens United

AFJ Statements on Citizens United 

• Statement for Nonprofits of Alliance for Justice President Nan Aron on the Supreme Courts decision today on Citizens United v. FEC 
• Statement of Alliance for Justice President Nan Aron about sweeping decision in Citizens United v. FEC Is a Stunning Display of Judicial Overreach     

Events

• Citizens United v. FEC and Its Impact on Elections, Democracy, and the First Amendment 
  April 14, 2010
  San Francisco, CA  

AFJ in the News

• Schumer, Van Hollen Walking A Tightrope: Their Efforts To Roll Back The Citizens United Ruling Are Likely To Face Attack From Both Sides
  » National Journal Online
• On February 16, 2010, Abby Levine, AFJ's Deputy Director of Advocacy Programs, participated in a panel on Citizen's United at the Hudson Institute
  » Watch on C-SPAN
• Chart outlines nonprofits impact of Supreme Court campaign-finance ruling
  » Chronicle of Philanthropy
• Supreme Court campaign-finance ruling could aid nonprofit advocacy but adds new concerns
  » Chronicle of Philanthropy