June 24, 2010

Advocacy Groups Divided Over House Passage of Campaign-Finance Bill

The House of Representatives has passed a controversial bill that is intended to lift the veil on who is paying for advertisements and other communications that could influence elections -- including nonprofit advocacy groups.

The measure was passed in response to a Supreme Court ruling earlier this year.

The bill would require corporations that issue political communications, including many advocacy groups organized under Section 501(c)(4) of the Internal Revenue Code, to reveal information about their donors.

Many liberal nonprofit advocacy groups opposed the bill because of an exemption from its requirements that would benefit large membership organizations like the National Rifle Association.

Exemptions would be provided to advocacy groups that have more than 500,000 members, are more than a decade old, have a presence in all states, and raise 15 percent or less of their funds from corporations or unions.

In a statement, the American Civil Liberties Union said that "by exempting larger mainstream organizations from certain disclosure requirements, the bill inequitably suppresses only the speech of smaller, more controversial organizations and compromises the anonymity of small donors."

The Supreme Court ruled in a case called Citizens United v. Federal Election Commission that a law barring corporations from using money from their general treasuries for "express advocacy" -- to urge that a candidate for federal office be elected or defeated -- was unconstitutional.

The court also struck down rules that prohibited corporations from spending money on "electioneering communications" -- TV or radio ads that mention a specific federal candidate within 30 days before a primary election or 60 days before a general election.

The Senate now will consider the legislation, H.R. 5175, known as the Disclose Act.