Ballot measure advocacy can be an important and powerful way to advance an organization’s mission and purpose. Last week, the Alliance for Justice hosted a Webinar to discuss the ways in which a 501(c)(3) organization may engage in ballot measure advocacy. Here is a list of 5 things nonprofits should know about advocating for state or local ballot measures in California.

1. Spend or Raise Less Than $1,000 Without Reporting.  In general, organizations, regardless of type, trigger reporting obligations for ballot measure advocacy if the organization spends or raises $1,000 or more on those activities per calendar year.  Therefore, organizations with limited expenses for such advocacy may avoid reporting requirements entirely if they raise and spend under the $1,000 threshold.
2. Use Newsletters and Member Communications. In California, there are several types of activities that do not trigger disclosure requirements. For example, organizations may advocate for a ballot measure in their regularly published newsletter, as long as the newsletter is distributed in the same style and manner as done previously. Any payments associated with the publication will not count toward the $1,000 threshold. Likewise, an organization with a valid membership structure may communicate with its members regarding ballot measures without triggering the state reporting requirements.
3. Minimize Reporting by Forming a Separate Ballot Committee. If an organization engages in ballot measure advocacy activities far above the $1,000 threshold, it may be prudent to consider forming a separate ballot measure committee. This committee may operate as a 501(c)(4) organization. Although the new committee would have significant ballot measure-related reporting obligations, the original charity would not if it continues to engage in non-reportable activities.
4. Utilize Staff. Paid staff time used for ballot advocacy must be registered and reported in California if the staff-person spends more than 10% of her time per month working on the measure. This means that if an organization is able to properly spread the advocacy work throughout its staff, the organization may not have to report the larger cumulative effort exerted for or against the ballot measure, if no employee exceeds the 10% limit.
5. Keep Both Federal and State Tax Law in Mind. Reporting and disclosure requirements for lobbying in California are often different than the requirements under Federal tax law. Organizations should understand and remain aware of those differences (see Introduction to Lobbying by Public Charities), and consider making the 501(h) Federal Lobbying Election.

Currently, California lawmakers are considering SB27, which would change the reporting threshold from $1,000 to $50,000, as soon as July 1, 2014. This significant increase could permit organizations to spend substantially more on ballot measures vital to their constituents, without triggering time-consuming reporting requirements.

Lastly, it is important to note that organizations should be aware of their reporting requirements under tax law and election and campaign finance laws.  When in doubt, nonprofits should seek counsel from an appropriate attorney.

Additional AFJ Resources:

Bolder Advocacy – California Advocacy Resources

Initiating Policy Change Circulating Ballot Initiatives in California