Nonprofit Rules Of The Road In Election Activity (Video)

Nonprofits are playing an increasingly visible role in shaping elections, but the overlapping rules of federal tax law and state campaign finance requirements can make even seasoned advocates hesitant to engage.

In this on‑demand webinar, Nossaman host Amber Maltbie and guest co‑host Andreanecia Morris of the Greater New Orleans Housing Alliance walked through the “rules of the road” for nonprofits that want to participate in elections without jeopardizing their tax status or running afoul of disclosure laws. They explained how different types of exempt organizations—501(c)(3) charities, 501(c)(4) social welfare organizations, unions and trade associations and 527 political committees—can engage in candidate races, ballot measures, lobbying, voter education and get‑out‑the‑vote efforts, and how to spot when separate state campaign finance rules are triggered.

Amber and Andreanecia also translated these legal frameworks into practical governance and compliance strategies drawn from real‑world experience. They discussed how to structure and firewall affiliated C3/C4/PAC entities, coordinate coalition work around shared electoral goals, manage staff conduct and personal political activity, leverage research and polling and plan for reporting and donor‑disclosure obligations in specific jurisdictions such as Louisiana. Throughout, they emphasized that understanding the rules is not about limiting impact—it is about expanding it safely and strategically, so nonprofits can wield political power on behalf of their communities while preserving their integrity and tax‑exempt status.

This webinar is a valuable resource for political action committees, nonprofit organizations, corporations, consultants and individuals involved in political campaigning. Watch now to gain actionable insights, better understand evolving legal requirements and stay ahead of current trends and best practices related to independent expenditures.

Transcript: Nonprofit Rules of the Road in Election Activity

0:00:07.8 - Amber Maltbie: Welcome, everybody. Thank you so much for taking the time to join us today, wherever you are. My name is Amber Maltbie with Nossaman LLP in the Government Relations and Regulation Practice Group. And today you are joining the second in our series of webinars on election law hot topics. And in this series, we are tackling hot topics in election law that are particularly on people's minds right now. But what's special about this webinar series is that for each webinar we're joined by a client or thought leader who's actually working in this field and can offer their practical insights. So the goal for this series is that for you, the viewer, you get the takeaways. We're going to break down the fundamentals of the law and then our co-host is going to break down what it's actually like, practically navigating these laws and ideally using it to their advantage to maximize their impact. And on that note, today our webinar is on nonprofits and election law, or nonprofits and elections, so the rules of the road for nonprofits who want to engage in advocacy either around elections or directly in elections. And our co-host today, I'm super excited... Today by Andreanecia Morris. Andreanecia is the chairwoman of the Greater New Orleans Housing Alliance, and it's been a privilege of ours to work with her and her organization. Andreanecia, I'd like to turn it over to you to talk a little bit more about yourself, but I do want to say by way of introduction, you wear many, many hats and you've really been at the forefront of developing a nonprofit ecosystem for tremendous impact in New Orleans and in Louisiana. So we're really pleased to have you and love to have you introduce yourself.

0:02:10.1 - Andreanecia Morris: Thank you so much, Amber and everyone at Nossaman. Your support over the years has been tremendous. And Amber is right, I wear a number of hats, as a lot of you probably do, if you work in the nonprofit space. And if you're going to do election work, electoral work, that's going to continue. It's going to almost have to continue. So I lead what we call the Put Housing First triad. It's three organizations working across the state to end housing insecurity, starting with what we call a very revolutionary and radical strategy in the city of New Orleans that also has to be replicated across the state and we hope eventually the country. I also sit at a number of other intersecting tables, particularly a couple of C4 coalitions around electoral efforts. And we're more focused on wielding power, helping the citizenry wield power in service of our larger goals. Those are our electoral strategies. We're not simply concerned about winning horse races. We're trying to develop champions around our issues, but also helping the people we serve be centered inside of these conversations and learning how to hold their elected officials accountable. That's our big push, and the electoral piece is a part of that.

0:03:35.6 - AM: Thank you. So that is... It's a big impact that you're talking about. And so before we get into the law, just big picture, how much anxiety do you think nonprofits should actually have when they're thinking about getting involved in elections?

0:03:55.8 - AM: Well, if you're a 501(c)(3) looking at this and thinking about standing up a C4 or an LLC or a PAC, and you're looking to get Amber's advice on this, once she can guide you through that. But you should also be aware of the fact that by virtue of the nonprofit industrial complex, you're already playing politics. It's just whether or not you're doing it well and to what efficacy. And if you find yourself at the wrong end of a political fight because... And unable to fight back and unable to... Most importantly, unable to serve the community you have pledged to serve because you've hamstrung yourself with a set of rules that doesn't actually meet the moment. So there should be thoughtfulness, there should be real concern about building anything out. And you should be clear about it, but you should also be aware of the fact that you've already been playing politics. You need to be more honest about it and stop wringing your hands and saying, "Oh, we don't want to play politics." You're a C3. If you're doing any social justice work, if you're doing any government contracts, you've already been playing politics. Get better at it.

0:05:13.0 - AM: I love that. I love that advice. Well, let's talk big picture and get a little bit into the intricacies of some of the infrastructure that you're talking about and whether you're a C3 thinking about starting a C4. When you're thinking about what do I want to do, how do I want to get involved, from the legal compliance perspective, there's two big buckets that the nonprofit has to be mindful of as they're developing their infrastructure. One is federal tax law. So what does the IRS say that my organization can do based on its exempt status? So are you a C3, a C4? But then also, what does the state campaign finance law say your organization's reporting or registration requirements are if you are communicating in an election? So maybe you're a C3 and you can't tell people to vote for a candidate, but you can certainly get involved in a ballot measure. So you need to know if you have to prepare and file a report, for example. And so these are the two main buckets that we're looking at when we're thinking through how to move your goals forward within a legally sound infrastructure.

0:06:42.9 - AM: And so our goal for viewers today is to identify what your nonprofit can do around an election. Again, this is being driven by the exempt status of your organization, and be able to issue spot when a campaign finance law comes into play. So we're not going to tell you that you'll walk away an expert in any of these laws, but you'll at least be able to pause and know when to talk to your in-house general counsel or your outside counsel and get clarity. So the big picture here is you've got... We'll be talking today about 501(c)(3)s. These are charities. 501(c)(4)s, these rules also apply to (c)(5)s and (c)(6)s, which would be unions and trade associations, but (c)(4)s are social welfare organizations. So you will frequently see them engaging in issue and electoral advocacy. And then the third category are called 527 organizations, but you've heard of them most likely as political action committees or PACs. So depending on which of those categories you are, that will drive what you can do, what your limits are with candidates, lobbying and ballot measures, and then nonpartisan activities. So very briefly, 501(c)(3)s, this is a golden rule, you are completely prohibited from doing any candidate intervention whatsoever. You cannot engage in candidate elections. If you're a 501(c)(4), you can. And oftentimes 501(c)(3)s and 501(c)(4)s, as Andreanecia mentioned, will work together or even be affiliated. So these are rules that you want to carefully follow.

0:08:42.9 - AM: A PAC, of course, that is all they do is they support candidates. For ballot measures, a 501(c)(3) can engage in ballot measures, and a 501(c)(4) can engage in unlimited ballot measures. So there's a lot of latitude there, so long as you're... If you're a (c)(3), you're operating within your limit on lobbying. And then finally, for voter registration, GOTV, these are your classic talking to voters, getting people registered to vote, getting them out to the polls. There's always big pushes around the election. As long as it's done in a nonpartisan fashion, then this is something that you can do unlimited, regardless of what your tax status is. But Andreanecia, I want to go back to what.. That you mentioned, working within a coalition, working in a table, especially around elections. Two questions for you. One, what are the advantages to working in a coalition? But also, what gives you anxiety about working in that type of a coalition?

0:09:55.6 - AM: So the issue is you've got to work in coalition. I have the pleasure of leading at this point the Triad plus two other organizations that are coalitions. We are collectives by design. The Greater New Orleans Housing Alliance is a table around housing. And so we do that all the time. We think it's required to do the depth and the breadth of the work that's necessary. But that also means that you're wrangling and herding cats by design. And if you're not a coalition, if you're an organization, a traditional nonprofit, be it (c)(3) or (c)(4), one of the limits that you have when it comes to electoral politics, when it comes to ballot measures, and frankly, wielding power in this way, is that you cannot do it by yourself. You can't do it alone. You have to be working across, not just across the aisle, you have to be looking... You have to be... First of all, you have to be thinking about things like win numbers and how much of what... What's your constituency? With an issue like housing or criminal justice reform or education, we all like to tell ourselves that our issues are incredibly important and everybody cares about them. Everybody's impacted by it, but that doesn't mean everybody cares about it. And you need to be... You want to not simply win horse races or spend money and raise money. You want to affect change, which means that you have to recognize your limits. You have to recognize the very nature of why campaigns can't just be won and lost by one group or one set of well-meaning volunteers or one large funder or donor. It has to be done... It has to be done in coalition and collective. And that's really hard. It's very hard because, again, people have already been playing politics. And whether or not everybody has the capacity to shift from what most of you are probably listening to this and say, "Oh, you sit at a bunch of coalitions, particularly coalitions pushed by philanthropy, that feel like shotgun weddings," and here we are telling you you've got to go do something else.

0:12:13.5 - AM: The coalition work that has to happen, the table work that has to happen around elections can't be like our normal C3 coalitions, the shotgun weddings that our funders call for. They have to be singularly organized around impact and winning for a specific purpose, and everybody's got to get on board with that. So it actually, in a lot of ways, requires a kind of discipline that kind of cuts through some of our typical headaches around working in collaboration and working in coalition. I tell people all the time what we have to move to with the C4 coalitions is we have to learn how to truly cooperate with each other. And that's hard, but it is required, it is necessary. You can't win races by yourself. You can't win ballot measures by yourself. You can't affect the kind of change that your communities need by yourself.

0:13:06.4 - AM: Yeah, that's really good insight. And I wonder with so many... Herding so many cats, you've got different priorities, but everybody coming together around one aligned goal, but by virtue of having different limitations, some groups have to, I imagine, pick up the laboring oar over others just because, for example, the 501(c)(3) at the table, they can't work directly on the candidate work. So they have to go... You're counting on them perhaps to spend their resources on other things.

0:13:59.4 - AM: That's right. Yeah. And it's not... And I'm not saying it's easy, but there's a level of clarity around it that gives you tremendous opportunities to cut through the nonsense. Right? So much of the work inside of nonprofits is dependent upon sometimes intangibles. We're talking about social justice work in particular, you're talking about investments that take time to pay off. Right? And this is much more immediate. It's not less important. It's much more immediate. Like, you can know whether or not you got a ballot measure passed. You're going to know within a few months whether or not the right candidate got elected. And those things might not turn out how you intended them to, but you're also going to know that relatively quickly, and there's going to be another window, another opportunity to affect change. And so some of that should be a relief for a lot of us, that you're going to see the impact. You're going to know if you made a mistake relatively quickly, and that gives you the freedom to pivot and to rethink that as opposed to, "Well, we gotta wait a few more years to see if this investment is actually going to bear fruit around systemic change." Like, did we win this election or not?

0:15:32.7 - AM: Well, let's use that as a pivot to actually talk about what are some of the common advocacy tactics that nonprofits do. And I think that's a really great way of thinking about it. There's the long-term systemic work within the ecosystem, but then you've got these immediate things. And some of the things that can be done, if you're a 501(c)(4) and you want to get involved very directly with electoral politics, you can directly support candidates so long as it is not becoming your primary purpose as a 501(c)(4). And that can look like making campaign contributions, hosting fundraisers. It can even look like paying for your own independent expenditures, which are paid political advertisements independent of a candidate to encourage voters to support or oppose them. And I think it may come as a surprise that some nonprofits have this much latitude to engage in this type of activity. But again, if you're a 501(c)(4), so long as this does not become your primary purpose, then these are all ways that you can help and be involved. One note though is that if you are making political contributions as a 501(c)(4), there are some states where corporations are prohibited from making candidate contributions. And so, as we'll talk about a little bit later, you'll want to make sure you're paying attention to the campaign finance laws of your state.

0:17:14.1 - AM: So if you're a 501(c)(3), there are things that you could do in and around candidate elections that are not going to be deemed partisan intervention. A (c)(4) can also engage in these activities and they won't count towards the 501(c)(4)'s non-primary purpose limits. So if you're a 501(c)(3), you can host a candidate to be a guest speaker at your event as long as it isn't inadvertently turning into a campaign event. It does have to be a neutral forum, perhaps having them come and speak to your members. Or you could host a forum with a number of candidates so people can come and learn from the candidates. But again, in order to do this as a 501(c)(3), these events have to be educational and informative. They can't be set up to prop up one candidate over another. There's also ways to talk about issues that are happening in and around elections that voters may be particularly sensitive to and primed to hearing your messages on. And you can do that in an educational way whether you're a (c)(3) or a (c)(4). And it won't count as lobbying or candidate activity if you're truly talking about the issues and you're truly talking about them in educational ways. So maybe there's concurrently a session of the legislature happening and there's a bill that's really important to the organization. You know that people are really paying attention right now, particularly because of the election. You might want to run an issue ad around that matter. So there are ways to communicate with the electorate that are educational and informative and aren't going to count as political activity, but can still have a lot of meaning and impact.

0:19:26.1 - AM: So, Andreanecia, actually, on this point of doing nonpartisan general communications... So nonpartisan, it sounds simple, but in practice, from your perspective, when you're doing a nonpartisan effort to reach voters, one, what are the risks from your perspective? But then also, do you take any steps to train or guard either your staff or other coalition members from turning something that's meant to be nonpartisan into a partisan free-for-all?

0:20:11.9 - AM: Well, so most of the time that's kind of already built into the nonprofit work. Right? Is that for the most part, even as C3s, and I lead three C3s plus two C4s, so we're very well aware of the fact that as social justice organizations, it may feel like, especially in a place like Louisiana, that we are in the bag for one party or another or against one party or another. And so it starts with how we build our organizations, especially as all five of the organizations that I lead, the housing triad in particular, we are focused on change. We are focused on fixing a broken system. And so that means we have to work inside of, no matter who is elected to what office and what letter is after their name, we have to work within those systems. And that means criticizing, supporting, pushing, nudging, nagging. And it's mostly nudging and nagging folks regardless of their status. So we're already primed for the nonpartisan part of it. And in New Orleans, I will tell you, on the housing issues over the last 20 years, I've spent more time criticizing Democrats than I do Republicans at the local level. That's just how that cookie crumbles. So we keep it focused on the impact of the work and we've been set up that way. Our issues are rooted in addressing things. Now again, some parties... Some people may make it their party identity to be against what we are against. That doesn't make us partisan. That makes them a problem. And again, we can't be afraid of that. You've just gotta make sure that you're centering your impact on what your issues are. Again, for us, it's housing. It's addressing housing insecurity, homelessness, climate change, all the intersectional issues around housing. And so it makes our North Star very, very clear. And it's more about building champions, especially when it comes to ballot measures and political work, building champions who will do what's in the best interest of the citizens. And again, we have the data and the strategies to back that up. So it's easy to assess whether or not someone is truly on our side.

0:22:47.6 - AM: Well, you mentioned ballot measures. So ballot measures, a lot of people may not realize this, but for purposes of federal tax law, ballot measures are treated like lobbying, the same as lobbying. And so even though a ballot measure, it's on the ballot, it's in an election, people vote on it, it's treated like lobbying. So a 501(c)(3) can be very involved in supporting a ballot measure up to whatever their lobbying limit is. And 501(c)(3)s can choose what test they want to use to limit their lobbying, and that's a topic for another webinar. But I seem to recall there was recently a bond measure. I mean, bond measures are something that are really important in the housing advocacy space. So, you have some experience with trying to influence ballot measures, right?

0:23:53.8 - AM: That's right. That's right. Yes. We almost... Especially at a local level, there is almost always something that we need to be considering. It doesn't mean we need to be involved in everything, but there's almost always something to be considering. And in New Orleans, our local officials love putting affordable housing at the top of bond measures that they have absolutely no intention of funding to address affordable housing. My favorite one of these was a few years ago, half a billion dollar bond measure called the Affordable Housing and Infrastructure Bond. Out of a half a billion dollars with affordable housing first, only $25 million was intended to go to affordable housing. And so that was not a bond measure we supported. We did not oppose it, but we did not support it either. And we've pivoted over the years and held it up as an example of the fact that it took years for that $25 million to actually be dedicated and spent on affordable housing. And some of it still hasn't been spent. That bond measure was in 2019, it's 2026, and the money's still floating around.

0:25:11.4 - AM: I think that's just such a.. That's a really good illustration of, I think, a few different ways that the nonprofit ecosystem can have a really important role from everything from working to pass a bond measure, maybe influence the contents of the bond measure before it's referred. I know in Louisiana, I think, they're referred to the ballot by the legislative body...

0:25:38.1 - AM: Oh, really?

0:25:38.6 - AM: Not necessarily by voters. But then in implementation, there's a role for nonprofits after a bond measure or ballot measure passes. There's a huge role for nonprofits in working with the government agency in the implementation of those measures. And those are ways that C3s and C4s both can have very hands-on roles. So I think to your point, there's the immediate win, but then there's the much larger, longer-term strategy and impact at play.

0:26:17.9 - AM: That's right. And that's where again, why I said earlier, we've got to get our C3s recognizing they're already playing politics. Because with something like a bond measure, those dollars often are going to go out through contractors, investments in infrastructure, and also leading to investments that nonprofits can access to do their work. So you're already playing politics and you do have the responsibility. You can't just sit back and say, "We convinced voters to vote for this," or, "We sat silent as it got passed and we don't have anything to say about it now because we're too busy scooping up our piles of the money." And, "We've gotta get the money to the ground," we hear so often. And we talk about the fact that you've gotta get the money into people's lives. Because by actually not helping take responsibility, you burn trust with community. And it becomes harder the next time. Even when there is something that everybody agrees community should vote for, they've been burned. They've been burned. And it is our responsibility. That's a big part of the things that people have to be looking at is: what's your North Star? Who are you accountable to? When we talk about wielding power in this way, that's the part that people I think sometimes are a little more worried about. You want an active, engaged electorate that's also going to check you.

0:27:56.4 - AM: Yeah. No, that is really great advice for organizations that are tuning in. Bringing it back just to some of the very basic rules around supporting a ballot measure, there are things that a 501(c)(3) can do and a 501(c)(4) can do within the ballot measure space. Blair was mentioning all the way through helping to pass a ballot measure, but nonprofits can be involved in every step of the way from actually drafting the language, gathering signatures in states where there are citizen-initiated ballot measures, organizing your own staff, organizing volunteers, and making political contributions. So there's lots of opportunity, whether you're a C3 or C4, to definitely get involved in the ballot measure space. One thing that I see nonprofits do is sharing research, polling. There's a lot of value in this type of information about voter attitudes. And a lot of times C3s or C4s will put together this information and then maybe the nonprofit will use it for their own purposes to advance their own mission goals, but then they have this asset that can be shared with other organizations. I see this happen quite a lot. And a lot of nonprofits will also just be involved in educating the public on some of these measures. They can be very complicated, particularly when we're talking about infrastructure, public financing. These can be really complicated issues. And so there's a really important role for nonprofits like yours to use their institutional expertise on an issue and educate people about the mechanics of what these bills and measures are actually going to do.

0:30:10.0 - AM: We mentioned briefly there's a lot of nonpartisan activities that nonprofits can get involved in, including doing get-out-the-vote drives, more voter education around the process of the elections. Where are your polling places? How can you vote? Can you vote by mail? Those rules have been up in the air and changing quite a bit recently and lots of ongoing litigation around that. So this is another area where nonprofits of any exempt status can be involved. And if it's all done in a nonpartisan way, it can have big impact. It can get voters out who care about the mission priorities of your organization without necessarily being partisan and counting against your limit based on your tax-exempt status. One of the other issues that I see come up a lot in election years for nonprofits is when you have the leader of a nonprofit or key staff from the nonprofit who are also actively engaged in a campaign. So sometimes we've had situations where an executive director of a nonprofit, they became a candidate. And so they took leave from their executive director position to go be a candidate. But I'm just curious, what are the best practices that you have for staff and for people who, when they're working for a C3, they can't use their compensated time to support a candidate, but maybe they wholeheartedly believe in that candidate? What are the guardrails that you give your staff to manage that?

0:31:58.5 - AM: So we're really bullish about this. We let our staff know on the C3 side their limits, and we actually don't want them engaged in the candidate work outside of it. They can't do that. We have a C4, there's an interdependence between the three organizations, and so the C4 staff are the organizers and they work in concert with some of the C3 staff to help very deliberately and intentionally for this very reason. And so we want to make sure that they don't do that. They're entitled to their personal opinion, but we do not want them on social media, we don't want them volunteering. It's discouraged. And of course, for the C4 staff, it's actively prohibited for the C4 staff to be doing anything with any candidate outside of our activities. And we've actually had people decline employment because they're like, "Well, I want to be doing a lot," especially with organizers who might be part-time, who want to be doing different things. And we're like, "Yeah, we can't have you representing us here and somewhere else you've switched off your hat and you're not representing us." And that's just not how that kind of work works. So we are pretty straightforward about these opinions, that folks get the chance to have their opinions made, but the organizational priorities have to be what's driving our political activities. And that's rooted in our obligation and our accountability with the voters themselves. And so as a member of staff, you get to have an opinion about what is going to work, from a policy standpoint, from a ballot measure standpoint, what positions that you want elected officials taking on issues on the work that you are supportive of. And that's the extent that you can talk about it. So we say, "No, no, no [0:34:15.6] ____ mas." We don't want you doing any of that. To the point where I don't personally donate to candidates at all. Not at all. I do not donate to any candidate inside of our sphere of influence. You'll see my name on FEC filings for people I know in other parts of the country, but I don't write a check to anybody, not even people we are supporting, because our support comes through that.

0:34:47.2 - AM: Yeah. Well, what you're describing, it's protecting several layers. You're protecting the institutional integrity of the organization, but I mean, you're also protecting the... Getting exempt status from the IRS is precious. And what you are describing is protective of that exempt status so you won't have staff who cross a line and inadvertently jeopardize the organization's standing with the IRS. So I think those are really great practices.

0:36:09.4 - AM: Yep. Yes. It's an interesting one where in such a heightened environment where you... Specially when want people thinking more strategically, you want people engaging, but that also means that we've gotta draw some hard and fast lines ourselves and be strategic, and not simply think about people's opinions in those kind of really simplistic ways without strategy. It's like you can have more impact this way. You can be better educated. That's what we're looking for, not simply people popping off on social media about their opinions about elected officials. And we have disagreements around some of those things. We'll have staff coming to the office wearing certain things that indicate their personal preferences, and as long as it's not overt, that's fine. But we've also really been proud of the fact that we've gotten those people to participate even when they differ. Some people might be a little more radical, some people might be a little bit more centrist. We want you participating, we want you articulating that, we want you offering that information to the community members who we, again, are accountable for around our political strategies.

0:36:58.0 - AM: Absolutely. Those are great points. Well, I want to move forward now to a slightly different topic, which is campaign finance. And when do we have to start thinking about all of these activities through a different lens, which is do the state laws require the nonprofit to do anything? So under most state campaign finance laws, if a ballot measure is being voted on on the ballot, then your activity under that state law is going to be considered political activity. And so whether your organization is supporting candidates or supporting ballot measures and you're spending general treasury funds to do it, or staff is supporting a campaign while they're on paid time, which won't happen under Andreanecia's watch, these are the questions that your organization needs to ask to make sure that it is going to be compliant with the state campaign finance law.

0:38:06.7 - AM: First one, very basic: Does your nonprofit qualify as a political committee under state law based on what you're doing, based on making contributions, if you're raising money to support a particular candidate? So that's first and foremost. Second: Does your activity require you to file any reports, whether it's simply registering with a state campaign finance body or an ethics board, or is it filing reports letting the state or municipality know what you're spending money on? Some states simply require that if you're making contributions that you file a report letting the state campaign finance regulator know and the public know who you're spending money to support, whether it's contributions or independent expenditures. And sometimes, and this is particularly important for nonprofit donors, is if you're making political contributions or if you're making paid political communications, advertisements to voters to influence the election, there are some places where that activity will require you to disclose the donors to your nonprofit. And this can come as a huge surprise to the organization. It can come as an even bigger surprise to the donor. It can cause some real problems with your donor relations. So it's one of the reasons why we strongly advise going through and making sure that you understand before you spend a dollar on a political cause in a state, are you going to be required to register, report, or disclose donors?

0:39:56.4 - AM: And a lot of the donor disclosure comes around... There's a lot of state legislative priorities around knowing who is behind funding election activities. So if you've heard the word "dark money" before, oftentimes it's referring to 501(c)(4) nonprofits that are engaging in elections because they're not required to disclose their donors. But so states are trying to tackle that. There's also been a wave recently of state legislation prohibiting nonprofits that have received funding from foreign sources from engaging in state candidate or ballot measure activity. So it's requiring a little bit more awareness about who your funding sources are in some of these places where nonprofits are active. So again, the big picture here is you need to know, do you have compliance requirements in that state and to know it before you spend a dollar so you can create your roadmap, your, what I like to call the compliance roadmap. And to put this all together, to bring it to life, I just wanted to walk through, especially because Andreanecia, you're our co-host today, what this practically looks like in Louisiana.

0:41:27.6 - AM: So the first thing that we do is we say, is the entity, the nonprofit, a committee? And in Louisiana, a nonprofit can become a political committee if it is both receiving and spending money on elections, so candidates or ballot measures. But here's the operative term, and it must also have a primary purpose of making contributions and expenditures. In other words, you're raising and spending money for political purposes and that is the main thing you do as an organization. So an ongoing 501(c)(4) that has a mission of, let's say, affordable housing, the environment, you name it, if they're occasionally dipping their toes in Louisiana elections, then they're not going to qualify as a committee. They're not going to have to register. So we can check that off. One less compliance thing to worry about. But that's not the end, right? The next inquiry is, well, do you have to file any reports? And in Louisiana, if you pay for an independent expenditure, so a paid communication telling voters to vote for or against a candidate or a ballot measure independently, then you do have to file a report with the state letting them know who you are, what you spent money on, was it TV, digital, et cetera, and how much you spent and what election you're seeking to influence. So you're not disclosing your donors, but you are letting people know, "Hey, this is what we did."

0:43:19.2 - AM: And then every state is different. Louisiana has a very particular rule that before a corporation can make an expenditure or a contribution, it actually has to have authorization from the board of directors, which can be done through a resolution. So you would first have to go, if you're making a contribution in Louisiana, go to your board and make sure you have that authorization in your corporate records, even though you don't have to file that anywhere. So just putting this all together, if you're thinking, "Okay, we want to spend money in a Louisiana election on a candidate," and you're a 501(c)(4), then you're looking at it through the IRS primary purpose limit that we talked about at the top of the hour. How much can we do this and be within our IRS primary purpose limit? And then you're checking to see if that activity, the election activity, is your primary purpose as defined by the Louisiana Campaign Finance Disclosure Act. Then you're getting your corporate approval and then you're filing your other person's report. So this is how you get to engage in Louisiana in a nutshell. So, Andreanecia, I know you've been through this. Without giving away any secrets, can you just give us a perspective from the inside? How do you coordinate this? How do you track this? Just how do you go about this?

0:45:03.9 - AM: Well, it starts with how you build the initiatives, right? How you build your operations. I am fortunate enough with this work is that of the three organizations, they're all post-Katrina initiatives, so they're under 20 years, but the Greater New Orleans Housing Alliance, which is the C4, is the oldest. So we started, we built this with the intention of doing lobbying, of doing electoral work. So that's the foundation of the Put Housing First triad. And the C3s came on because there's was work that could be done, particularly some of the organizing, some of the policy and research and data work, the education. It's just more appropriate and, frankly, more straightforward to be able to raise resources for that with some of those pieces. So we built it that way. And it doesn't mean that if you haven't started, if you're starting as a C3, you can't figure it out, but you have to start with that intention. You have to be clear about putting in the guardrails, to Amber's point, to your point, Amber, putting in the firewalls where necessary, getting clear about who has authority and when the firewalls go up, what does planning look like? So that you're never coordinating in a way that's not helpful. Also, when it comes to the C4 expenditures, when it comes to the C4 investments, there's the primary purpose because we're social welfare organizations. We're not simply... We're not committees. So we're not just about political action committees where we're invested in elections. We are organized around a specific issue, a social justice issue. And so that work has to be getting done. And it can be electoral work, it can be ballot measures, it can be the lobbying. As a C4, we're unlimited on the lobbying that we can do.

0:47:08.2 - AM: So again, when a bond initiative passes, we can be making sure that the money goes where it's supposed to go and be really engaging on that, working with our legislature to get legislation passed to help put in more guardrails for those dollars. And so it's how you start it, right? How you take this step. How you use this as a tool to become more effective. And so we've thought about that very deeply, built in things, guardrails, documents to say who's doing what. We spent a great deal of time just showing how the organizations interact with each other and the people inside the organizations, how they are supposed to be interacting. All of that's documented. All of that's written down. You can't be afraid of those things. You've got to actually spend the time thinking it through and writing it down and getting a lawyer to review it with you, getting help. I cannot urge this enough. When we started, Nossaman wasn't working with us 20 years ago when we set up the Greater New Orleans Housing Alliance. We had tremendous help from national lawyers who came in to help us and the Lawyers' Committee for Civil Rights Under Law. So that's not bad right there, coming in and helping us stand up the initiative. Not everybody's going to be able to get the Lawyers' Committee, but... Doing it pro bono, but that's because we had a hurricane, right? Unprecedented disaster coming through.

0:48:51.1 - AM: You all can get access to a really great firm because we're working with Nossaman now and how we think about this. So you gotta get help, you gotta think about it. You can't be afraid to ask the stupid questions, to talk about what you know is going to be happening in your community, to run through the scenarios and put in place the guardrails and then also just getting gut checks. So that is how we do that. And so that's not secret sauce, and I'm happy to share that with anybody, is think it through, talk to your lawyer and just have the honest conversations about your intentions. If you got your North Star really clear and you know there's a reason to do it, your attorney is there to help you figure out how to do what is required, not just to tell you, "No, well, you can't do that," right? Well, if it's required. And again, this is why you have coalitions, because maybe you're not the organization to be doing it. Maybe one of your partners should be doing it. And that's also the reason you need really good legal advice and really strong guardrails, strong board members who actually also understand what's necessary and can help advise and craft strategy.

0:50:18.6 - AM: What I'm hearing from you and I think that this is so empowering and I really hope is the takeaway that our viewers get, but what you are saying is all of these rules, they're not limitations. Organizations shouldn't be afraid of them. You can lean into them and maximize your impact if you just understand the rules and have a plan to work with them.

0:50:45.3 - AM: That's right. That's right. For us, I know with the reporting piece that a lot of the pieces... Because the C4 is the oldest, a lot of our infrastructure is inside the C4 already. So we're never going to have somebody who's working on something that's critical around reporting and administrative piece that doesn't work for the C4. They might end up accidentally or even deliberately doing some C3 work. Then the C3 has to compensate the C4 for that. So we bill for those things. And it was one of the decisions that we made early on that when we added the C3s was that we never wanted money coming from the C4 to the C3s. The C3s needed to be paying for things that the C4 would be doing, like lobbying, like administrative work that wasn't out of line, but that was just happening because this person was the most skilled at it. And we've even expanded when it comes to people like our legal advice. Nossaman is contracted with one of the organizations because they don't provide advice to the other two. It's just that. But we have other lawyers that have separate contracts with each entity to have those lines really clear. So we do a lot of billing and coding and managing people's time.

0:52:23.1 - AM: Yeah. Well, I think that's very helpful, very practical advice, especially for organizations that do have affiliated entities. We are at the top of the hour. It has flown by. This has been such a great conversation. Andreanecia, again, thank you so much for taking time out of what I know is your very busy schedule to share many, many, many gems of wisdom for folks who are either jumping in, getting their feet wet for the first time, or maybe trying to figure out how to shift gears and be a little bit more proactive. So thank you again and to the viewers. This is part two in our Election Law Hot Topics webinar series. There will be more to come, so please check back soon. Thank you.