On September 21, 2006, All Saints Episcopal Church declared that it will refuse to comply with an investigation by the Internal Revenue Service for possible violation of tax laws prohibiting charitable organizations described under Section 501(c)(3) of the Internal Revenue Code from engaging in political campaign activities. The investigation stems from a sermon in November 2004 delivered by Rev. George F. Regas, a former rector, which, among other things, criticized the war in Iraq and identified as the enemy "conservative politicians with the blessing of the religious right." The sermon, given two days before the 2004 presidential election, did not explicitly endorse or reject a candidate for public office.
All Saints, which is represented by attorney Marcus Owens, a former head of the IRS Exempt Organizations Division, has decided not to answer a summons to turn over records related to the sermon. According to the L.A. Times (September 22, 2006), All Saints wants the IRS to pursue this matter in federal court. Owens successfully represented the NAACP on a similar matter which concluded earlier this year.
501(c)(3) organizations may not "participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office." Among the prohibited activities are: endorsing a candidate for public office, contributing to a candidate’s political campaign funds, and favoring one candidate over others with respect to allowing use of the organization’s assets or facilities.
501(c)(3) organizations may take positions on public policy issues, including issues that divide candidates in an election for public office. However, they may not engage in issue advocacy that functions as political campaign intervention. Even if an organization broadcasts a message that does not expressly endorse or oppose a public candidate, it may violate the prohibition against political campaign activities if the message favors or opposes a candidate, particularly if the message (a) identifies specific candidates, (b) expresses approval or disapproval of a candidate’s positions or actions, (c) is delivered close in time to an election and is not part of an ongoing series of communications on the same issue, (d) addresses an issue that distinguishes candidates for a given office, and (e) is not related to a non-electoral event, such as a scheduled vote on a specific piece of legislation by an officeholder who also is a public candidate.
The San Francisco Chronicle (October 2, 2006) reported that conservative leaders have taken up All Saints’ cause, and some are seeking to eliminate the prohibition on the political campaign activities of churches. Rep. Walter Jones Jr., R-N.C., seeks passage of the Houses of Worship Free Speech Restoration Act, a bill he sponsored which has been sitting in committee for the past three years. Many liberals believe such a bill would be much more favorable to conservative religious organizations with explicit political agendas. It’s therefore not surprising that even as All Saints is fighting the IRS investigation, Bob Long, the senior warden of All Saints, stated that "it’s a wise policy that churches like ours should not endorse candidates, and we don’t want the law changed."
Click here to read the L.A. Times article.
Click here to read the San Francisco Chronicle article.
Click here to view All Saints’ Website, including the transcript of Rev. Regas’ sermon and communications between All Saints and the IRS.