Introduction to
Advocacy and Public
Policy
Presenter
INSERT NAME
INSERT ORGANIZATION NAME
Agenda for Session
 Setting the stage for nonprofit advocacy as a
best practice in the Standards for Excellence:
An Ethics and Accountability Code for the
Nonprofit Sector®
 Lobbying vs. advocacy
 Developing an advocacy policy
 Allowable lobbying activity
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Federal, state, and local rules
Remaining nonpartisan
Accurate reporting on state disclosure reports
and Form 990
The Standards for Excellence®
Code
 8 Principles & 55 Standards
 Mission and Program
 Governing Body
 Conflict of Interest
 Human Resources
 Financial & Legal
 Openness
 Fundraising
 Public Policy & Public Affairs
The Standards for Excellence®
Code
 A blueprint for well managed and responsibly
governed nonprofit organizations
The Standards for Excellence®
Code
 Educational resources to help you build a
stronger, more attractive and sustainable
nonprofit institution.
Is lobbying even permitted for
nonprofits?
 There is a myth out there that nonprofit
organizations are prohibited from lobbying
elected officials. This is simply not true.
 Nonprofit organizations often exist to serve
the underserved. Nonprofits provide a voice
and can truly help educate and advocate for
those they serve.
Lobbying vs. Advocacy
 What is the difference between advocacy and
lobbying?
 Nonprofit leaders often confuse these terms.
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Advocacy is defined as active support for a
cause, idea or policy.
Lobbying generally consists of
communications that are intended to influence
specific legislation
Advocacy vs. Lobbying
Public Education
Media and
Messaging
Campaigns
Litigation
Organizing Activities
Protests & Marches
Normally Defined by
Statute
State and Local Laws
May Vary From IRC
Provisions
Usual Key Elements:
Communication,
Subject Matter &
Money
Developing an Advocacy Policy
 Planning considerations:
1 - What are the criteria or factors that
determine the broad interest/ issue areas where
your organization may become involved in
policy advocacy?
2 – Who needs to be involved in making these
decisions?
3 – How will this process be accountable to the
Board?
4- How often do you need to consider positions
on issues?
Developing an Advocacy Policy
 Additional considerations:
1 – Mission:
Is the issue related to the organization’s ability
to meet its mission?
2 – Impact:
Are there aspects of the issue that affect the
interests of the nonprofit organization (and/or its
clients) in a significantly different way than the
interests of the community at large?
Developing an Advocacy Policy
 Additional considerations:
3 – Consensus:
Is there, or do you reasonably anticipate that
there will be, at least a general consensus
among the members or constituents of the
organizations on the position to be taken?
4 – Credibility:
Would your organization be perceived as a
legitimately concerned and appropriate
advocate for the position to be taken?
Developing an Advocacy Policy
 Additional considerations:
5 – Flexibility:
Will the policy provide flexibility for a subset of
the government relations or public policy
committee to make decisions and/or speak on
behalf of the whole group when time or
circumstances do not permit additional process.
Sample Advocacy Policy #1
1 - Each year (Every two years, every five
years), the ABC Nonprofit Public Policy
Committee will survey the membership of
the organization to develop a list of
suggested public policy priorities for the
upcoming year. Based on this input and
input from ABC’s Board of Directors, the
Public Policy Committee decides priority
issues, and ranks such issues in order of
importance.
Sample Advocacy Policy #1
2 - The priority issues serve to establish the
public policy framework. The board of
directors must approve the public policy
framework.
3 - All advocacy activities for [the selected
time frame] should fall under the current
priority issues.
Sample Advocacy Policy #1
4 - In circumstances where immediate public
policy attention is required, the chair of the
public policy committee, and the Executive
Committee may make decisions on behalf of
the entire Public Policy Committee for ABC
Nonprofit on specific bills and issues.
5 - Only the board president, the executive
director, and the chair of the public policy or
government relations committee may speak
on behalf of ABC Nonprofit or take action on
local, state, or federal public policy issues.
Sample Advocacy Policy #1
6 - ABC Nonprofit is a nonprofit organization.
As such, ABC Nonprofit does not support or
oppose candidates for public office or
political parties and only acts on issues
related to the organization’s mission and its
current public policy framework.
Sample Advocacy Policy #2
 I. General statement
 In order to work toward making systematic
change necessary to achieving our mission,
ABC Nonprofit engages in advocacy activity or
active support for a cause, idea, or policy. It is
the policy of ABC Nonprofit to advocate on
public policy issues that support the mission of
the organization, such as: x, y, and z.
Sample Advocacy Policy #2
 II. Criteria for Public Policy Positions
 ABC Nonprofit may take positions on public
policy issues, which fulfill three basic criteria:

Affects ABC Nonprofits’ ability to work toward its
mission OR Affects ABC Nonprofits’ clients or
program participants OR Affects the nonprofit
status or operations of ABC Nonprofit
Sample Advocacy Policy #2
 III. Process for determining positions
 CHOOSE ONE:
 (1) Advocacy positions on specific issues will be
determined on a case by case basis by
consensus of the (executive committee of the)
board. OR
 (2) Advocacy positions on specific issues
related to the mission of ABC Nonprofit will be
determined by the executive director, and in
his/her absence, may be determined by the
deputy director. OR
Sample Advocacy Policy #2
 (3) As delegated by the ABC Board of Directors, ABC
Nonprofit’s Public Policy Committee assesses issues of
potential interest and concern to determine if such
issues should become subjects for advocacy for the
organization. The Public Policy Committee may
delegate its decision-making authority to a designated
staff person. OR
 (4) Each year, ABC Nonprofit surveys its members and
clients on a series of potential public policy issues for
which it may become involved. Based on results of
surveys, related research and comments from
members, clients, and staff, ABC’s Board/Staff/Public
Policy Committee determine advocacy positions for the
year.
Sample Advocacy Policy #2
 IV. Concerning participation on coalitions
 (1) In ABC Nonprofit’s work with coalitions and
associations, ABC Nonprofit may take part in
the advocacy work of a group provided the work
is not in conflict with ABC Nonprofit’s mission.
 (2) ABC Nonprofit conducts its advocacy work
through coalitions and networks such as: X, Y,
and Z.
.
Sample Advocacy Policy #2
 V. ABC Nonprofit is nonpartisan in its
activities.
 Clients of ABC Nonprofit represent a broad
cross-section of the political spectrum. ABC
Nonprofit does not support one candidate over
another candidate; and does not support any
political parties. Maryland Nonprofits works with
both political parties in legislative efforts. If we
ask one candidate for office to speak at events
or conferences, an invitation is extended to any
opposing candidates as well.
Limited Advocacy Policy
ABC Nonprofit does not pursue public policy advocacy as part of its
regular program activities. We recognize, however, that as a leader in our
field, we are occasionally (regularly) called upon by government officials,
members of the media and others to offer positions on policy issues
affecting the recipients of our services or to share knowledge and
expertise relevant to ongoing policy deliberations. ABC Nonprofit is also
called upon to sign on to formal and informal coalitions that advocate for
the interests of our clients.
The Executive Director may authorize participation in such activities
when s/he determines such participation is consistent with the mission of
ABC Nonprofit and that the interests of the clients are sufficiently clear.
Where participation is warranted, the Executive Director shall be
responsible to determine the nature and extent of participation, including
the positions to be stated or information to be shared.
Allowable Lobbying Activity
 What is allowed under the law?
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Federal
State
Local
Allowable Lobbying Activity
Federal Lobbying Limits
 2 options
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Insubstantial Part Test
501(h) Election Expenditure Test
Allowable Lobbying Activity
Federal Lobbying Limits
 Insubstantial Part Test
26 U.S.C. § 501(c)(3); 26 C.F.R. §
1.501(c)(3)-1(b)(3)(i)
 Default Test
 Lobbying must be an “insubstantial part” of
overall activities
 Include cost-free activities when determining
if substantial
Allowable Lobbying Activity
Federal Lobbying Limits
 501(h) Expenditure Test
26 U.S.C. § 501(h); 26 C.F.R. §1.501(h)
 Elect by one-time filing of Form 5768
 Clear dollar-based limits
 Only expenditures count towards limits
 Clear definition of lobbying
Allowable Lobbying Activity
Federal Lobbying Limits
 501(h) Expenditure Test
26 U.S.C. § 501(h); 26 C.F.R. §1.501(h)
 This step allows 501(c)(3) organizations take
advantage of the clear definitions and
generous limits on lobbying that were added
to the Internal Revenue Code in 1976. These
rules are sometimes called “the expenditure
test” Only expenditures count towards limits
 Eligible organizations that make the election
do so without changing their 501(c)(3) status
Allowable Lobbying Activity
Federal Lobbying Limits
 501(h) Expenditure Test
 Making the election simply requires filing
Form 5768, “Election/Revocation of Election
by an Eligible 501(c)(3) . Organizations to
Make Expenditures to Influence Legislation”
 Available at www.irs.gov
Allowable Lobbying Activity
Federal Lobbying Limits
 501(h) Expenditure Test
 The single-page form calls for the
organization’s name, address, and first tax
year to which it wants the election to apply. It
requires only the signature of the authorized
officer, usually the president or treasurer.
Allowable Lobbying Activity
Federal Lobbying Limits -501(h)
1) Calculate organization’s “Exempt Purpose
Expenditures” BUDGET for most groups
2) Overall lobbying limit is:
20% of first $500,000 plus
15% of next $500,000 plus
10% of next $500,000 plus
5% of the remaining expenditures
3) Grassroots lobbying limit is 25% of overall
limit
$1 million cap on total
lobbying expenditures
Allowable Lobbying Activity
Elements of Direct and
Grassroots Lobbying
Direct Lobbying
Grassroots Lobbying
Communication
Communication
Legislator
General Public
Expressing a View
Expressing a View
Specific Legislation
Specific Legislation
Call to Action
26 C.F.R. § 56.4911-2(b)(2)
Total Lobbying Limits for Sample
501(c)(3) making (h) election with
$2 million. budget
Direct
Lobbying
Education & NonLobbying
Advocacy
Grassroots
(max. ¼ of
total
lobbying)
Maximum
Total
Lobbying:
Grassroots
+
Direct
12.5%
Total Lobbying Amount: $250,000
Grassroots Lobbying Amount: $62,500
Allowable Lobbying Activity
Definitions of Legislators
 Members of special purpose boards are
NOT legislators
 Planning Commissions
 Zoning Commissions
 School Boards
26 C.F.R. § 56.4911-2(d)(4)
Allowable Lobbying Activity
Ex. of Lobbying Communications
More than just
conversations,
letters, email….
Effects of 501(h) ElectionLIMITS
501(h) Electing
Not Electing 501(h)
 Sliding scale of limits on
 Substantial lobbying using
exempt purpose
expenditure:
 20% of 1st $500,000
plus
 15% of next $500,000
plus
 10% of next $500,000
plus
 5% of remaining
expenditure
 $1 million limit
a subjective balancing test,
including:
 Importance of lobbying
to organization’s
circumstances
 Actual lobbying
expenditures and
activities, including
volunteer
 Overall spending and
activity level
Effects of 501(h) ElectionLIMITS
501(h) Electing
Not Electing 501(h)
 No limit on volunteer
 Volunteer activities are
activity
included in determination of
activities
Source: Worry Free Lobbying for Nonprofits, Alliance for Justice,
Charity Lobbying in the Public Interest
Effects of 501(h) ElectionEXCLUSIONS FROM LOBBYING
501(h) Electing
Not Electing 501(h)
 Responses to legislative
 No specific exclusions
bodies requesting
information
 Nonpartisan analysis that
presents all sides of an
issue
 Defending against direct
challenges to
organization’s existence
 Broad examination of
social issues
Source: Worry Free Lobbying for
Nonprofits, Alliance for Justice,
Charity Lobbying in the Public Interest
Effects of 501(h) ElectionRECORD KEEPING
501(h) Electing
Not Electing 501(h)
 Documentation of all
 Documentation of all
expenses, grassroots and
direct
expenses and activities
that could be considered
lobbying, including
volunteer activities, it is
advisable to document
non-lobbying volunteer
activities for comparison
Source: Worry Free Lobbying for Nonprofits, Alliance for Justice, Charity
Lobbying in the Public Interest
Effects of 501(h) ElectionREPORTING
501(h) Electing
Not Electing 501(h)
 Report on IRS Form 990
 Report on IRS Form 990
Schedule C Part II-A
 Lobbying Expenditures
 Percentage of total
expenditures
 And related calculations on
ceilings, maximum
thresholds
Schedule C Part II-B
 Detailed description of
legislative activities,
including volunteer
activities
 Classified schedule of
expenses, paid and
incurred
Source: Worry Free Lobbying for Nonprofits, Alliance for Justice, Charity
Lobbying in the Public Interest
Effects of 501(h) ElectionREVOCATION OF TAX STATUSStandard
501(h) Electing
Not Electing 501(h)
 Exceeding 150% of limits
 Substantial lobbying in any
based on a 4-year moving
average
one year
Source: Worry Free Lobbying for Nonprofits, Alliance for Justice, Charity
Lobbying in the Public Interest
Effects of 501(h) ElectionPENALTY FOR EXCESSIVE
LOBBYING
501(h) Electing
Not Electing 501(h)
 25 % of excess lobbying
 5% of total lobbying
expenditure
 Directors and officers have
no exposure
expenditure if exemption is
revoked
 Directors and officers fined
penalty of 5% lobbying
expenditures if lobbying is
found to be willful or
unreasonable.
Source: Worry Free Lobbying for Nonprofits, Alliance for Justice, Charity
Lobbying in the Public Interest
Effects of 501(h) ElectionAUDIT
501(h) Electing
Not Electing 501(h)
 The IRS Manual
 No specific guidelines
specifically informs
examiners that making the
election will not be a basis
for making an examination
Source: Worry Free Lobbying for Nonprofits, Alliance for Justice, Charity
Lobbying in the Public Interest
Allowable Lobbying Activity
Federal Lobbying Limits
Who Might Not Want to Elect
Large nonprofits with
budgets over $17 million
Allowable Lobbying Activity
State Lobbying Limits
 See National Conference of State
Legislators Catalogue of State Lobbying
and Ethics Laws
 http://www.ncsl.org/Default.aspx?TabId=1
5352
Allowable Lobbying Activity
State Lobbying Limits
 Pay particular attention to:
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Ethics Regulations
Lobbyist Regulations
Gifts/conflict of interest provisions
Reporting of lobbyists and organizations
Disclosure of activities, finances
State Lobbying Limits
Example: Maryland
 Legislative: Registration required if the person
communicates in the presence of an official or
employee in the legislative or executive branch
for the purpose of influencing legislative action
and
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Incurs expenses of $500 or more
Earns $2,500 or more as compensation from all
lobbying employers; or
The person is not in the presence of an official,
but communicates to influence legislation and
earns at least $5,000 for all such communication
activities during the reporting period
State Lobbying Limits
Example: Maryland
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Grassroots: Registration required for any
person, group, organization or business that
expends $2,000 to influence legislation (including
salaries, contractual employees, postage, etc.)
during reporting period
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http://ethics.gov.state.md.us
State Lobbying Limits
Example: Maryland
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Executive Action Lobbying:
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Registration Required IF:
The person communicates with any official or
employee in the executive branch for the purpose of
influencing executive action during the reporting
period and the person expends a cumulative
amount of $100 or more during the reporting period
on one or more officials or employees of the
executive branch for meals, beverages, special
events or gifts in connection with or for the
purpose of influencing executive action.
Any executive action activity is covered by this
provision.
State Lobbying Limits
Example: Maryland
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Executive Action Lobbying:
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The person is compensated $2,500 or more in a reporting period,
from all lobbying employers cumulatively, for all such
communication and activities relating to the communication or
incurs expenses of $500, per lobbying employer, or more (other
than for personal travel or subsistence) and gets in the presence of
an official or employee for the purpose of influencing executive
action relating to the development or adoption of regulations or
the development or issuance of an executive order;
OR
Earns at least $5,000, from all lobbying employers
cumulatively, as compensation for all such communication and
activities relating to the communication during the reporting
period, even if not in-the-actual-presence of officials or employees
for these purposes.
State Lobbying Limits
Example: Maryland
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Maryland Lobbyist Registration:
Reporting Periods
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The Lobbying registration year begins November 1
and ends October 31.
The year is divided into two reporting periods –
November 1 thru April 30 & May 1 thru October 31.
Reports are required within 30 days of the end of
each reporting period.
Training available from the Ethics Commission –
posted on their web site.
State Lobbying Limits
Example: Delaware

"Lobbyist" means any individual who acts to promote, advocate,
influence or oppose any matter pending before the General
Assembly by direct communication with the General Assembly or
any matter pending before a state agency by direct communication
with that state agency, and who in connection therewith either:
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a. Has received or is to receive compensation in whole or in
part from any person; or
b. Is authorized to act as a representative of any person who
has as a substantial purpose the influencing of legislative or
administrative action; or
c. Expends any funds during the calendar year for the type of
expenditures listed in § 5835(b) of this title.
State Lobbying Limits
Example: Delaware
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Reportable Expenditures:
(b) A lobbyist shall file separate reports for each employer which the
lobbyist represents. Each report shall contain the total expenditures
during the reporting period for all direct expenditures, costs or values,
whichever is greater, provided for members of the General Assembly
or for employees or members of any state agency for the following:
(1) Food and refreshment;
(2) Entertainment, including the cost of maintaining a hospitality room;
(3) Lodging expenses away from home;
(4) Fair value of travel if the trip exceeds 100 miles;
(5) Recreation expenses; and
(6) Gifts or contributions, excluding political contributions as defined in
Chapter 80 of Title 15 provided to members of the General Assembly.
- Section 5835 (b) -
State Lobbying Limits
Example: Delaware
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Exceptions Not Lobbying:
If no reportable lobbying is made:
(1) Persons performing professional services in drafting bills or regulations
or in advising and rendering opinions to clients as to the construction or
effect of proposed, pending or enacted legislation or regulations who do not
otherwise act as lobbyists;
(2) Persons appearing pursuant to their official duties as employees or
elected officials of the State, or any political subdivision thereof, or of the
United States, and not as representatives of any other person; moreover,
expenditures listed in § 5835 of this title made by such persons or their
employers in connection with these official duties shall not qualify such
persons as lobbyists under subsection (a)(5)c. of this section;
(3) Persons who, in relation to the duties or interests of their employment or
at the request or suggestion of their employer, communicate with the
General Assembly or a state agency concerning any legislation, regulation
or other matter before the General Assembly or such state agency, if such
communication is an isolated, exceptional or infrequent activity in relation to
the usual duties of their employment
State Lobbying Limits
Example: Delaware

More Lobbying Exceptions:
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(4) Persons communicating with the General Assembly or a state agency if
such communication is undertaken by them as a personal expression and not
as an agent of their employers as to matters of interest to a person by whom
or by which they are employed and if they receive no additional compensation
or reward, in money or otherwise, for or as a result of such communication;
(5) Persons testifying at public hearings conducted by the General Assembly
or a state agency who do not otherwise act as lobbyists;
(6) Persons appearing on behalf of any religious organization with respect to
subjects of legislation or regulation that directly relate to the religious beliefs
and practices of that organization who do not otherwise act as lobbyists;
(7) Attorneys representing clients in administrative adjudications governed by
the provisions of subchapter III of Chapter 101 of this title, representing clients
before the Tax Appeals Board, or in other administrative procedures where ex
parte communications with the state agency with authority over the matter are
prohibited;
(8) Attorneys representing clients with regard to criminal or civil law
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enforcement proceedings, or in any judicial proceedings.
State Lobbying Limits
Example: Delaware
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Key Points
Compensation is not required – volunteers may be “Lobbyists”
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“Direct Communication” required to trigger the statute – organizing
‘grassroots’ lobbying doesn’t count
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“Reportable Expenditures” void the statutory exceptions
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For volunteers or organization members, the “authorization” and
“substantial purpose” elements in the statute are critical

Statute not limited to legislative “matters” – scope is broader than
Internal Revenue Code regulations
Allowable Lobbying Activity
Local Regulations
 If you are conducting public policy and
lobbying efforts at the local level, you will also
want to research relevant local rules and
regulations for lobbyists
 Again, pay particular attention to:
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Ethics Regulations
Lobbyist Regulations
Gifts/conflict of interest provisions
Reporting of lobbyists and organizations
Disclosure of activities, finances
Allowable Lobbying Activity
Remaining Nonpartisan
 While nonprofit organizations have an
opportunity to educate the public and engage
in public participation, organizations need to
ensure that all participation in community
affairs shall be strictly nonpartisan.
Allowable Lobbying Activity
Remaining Nonpartisan
 What can a 501(c)(3) do?
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Issue advocacy
Conduct candidate forums/meet the candidate
nights with all candidates
Send questionnaires to each candidate
Voter education
Voter registration & get-out-the-vote activities
Candidate education
Remaining Nonpartisan
Is the activity nonpartisan?
 Facts and Circumstances Test

Does it look like you are supporting or
opposing a candidate for public office?
Remaining Nonpartisan
Is the activity nonpartisan?
High Risk
Some Risk
Low Risk
Remaining Nonpartisan
Is the individual’s activity
nonpartisan?
 Individuals acting in their own capacity
can engage in electoral activity
 Must be off the clock or on personal leave
 Organizations cannot ratify the
individual’s acts expressly or by
implication
Questions and Answers
INSERT NAME
INSERT TITLE
INSERT ORGANIZATION
INSERT ADDRESS
INSERT EMAIL
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