Tuesday, May 21, 2013

Veto? Bill Targets NPOs For Political Donations

On May 14, 2013 the Texas 83rd Legislature passed a bill requiring Non-Profits to report all political donations if they total over $25,000.


             (3)  makes one or more political expenditures, excluding expenditures authorized by Section 253.098, 253.099, 253.100, or 253.104, that in the aggregate exceed $25,000 during a calendar year.

Furthermore, SB 346 requires itemization of contributions exceeding $1,000.


       Sec. 254.283.  CONTENTS OF REPORT. (a)  Itemization of a contribution under Section 254.031(a)(1) is required only if the contribution exceeds $1,000 during the reporting period. 
       (b)  The first report required to be filed in a calendar year in which the $25,000 threshold under Section 254.281(a)(3) is exceeded must include all political contributions accepted and all political expenditures made in that calendar year.
Of note, labor unions are exempt from reporting political donations.



       (b)  This subchapter does not apply to a labor organization or any subordinate entity or associated account of a labor organization.

Though the bill has been forwarded to the Governor's Office for action, Governor Rick Perry has not yet signed it into law. The full enrolled version of the bill forwarded to the Governor is available this link.


Call To Veto:  Concerns Over Targeting Political Donations


Erick Erickson of Red State Magazine (and WSB Radio in Atlanta, GA) published an editorial on the bill.

Mr. Erickson makes several key points in his argument for veto of this bill. Perhaps one of the key points he made was that reporting and releasing the names of donors could bring unethical and illegal targeting against these organizations or their individual donors.

Mr. Erickson cites such activity in Wisconsin and California in the recent past. In addition, the recent revelations of IRS targeting specific groups for special auditing aggravates these examples.

Beyond Mr. Erickson's well-stated debate, there are other issues proponents of a veto add.

One such item of consideration is the US Supreme Court's decision in the controversial Citizens United case. The US Supreme Court decision may apply to potential misuse and targeting promoted by the SB 346  mandate to report all political donations by non-profit groups.


Another argument for veto may include 14th Amendment violations. The bill targets specific groups who are not conducting illicit activity. The political donations reporting law could, feasibly, be considered to deny just and equal treatment under the law. This point is exacerbated by the final argument in favor of veto.

Among the several stated reasons to veto the political donations reporting bill, SB 346, is the exemption for labor unions. It is public knowledge that the largest labor unions in the US make routine political donations on behalf of their members. Their contributions almost exclusively go towards one political party. Exempting labor unions from these political donation accountability laws appears to specifically target those NPOs who donate to the opposing party. The bill, therefore, is biased and unethical. Should labor unions also be required to report political donations and contributions, the bill would be far more equitable.

In addition, most labor unions make these political donations regardless of the political ideology of their members. They collect the union membership dues and make political donations from those dues.


Based upon the several questions and counter-points to the bill, it will be interesting to see Governor Perry's resulting actions. His decision could have a huge impact on any future political aspirations.