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SANTA FE — Legislation to restrict the activity of nonprofit organizations during an election year appears to have momentum.
The House Voters and Elections Committee unanimously approved a bill (HB808) Tuesday morning that only a week ago was tabled by the same panel.
The bill, sponsored by Rep. Paul Bandy, R-Aztec, was amended with substitute language that makes it virtually a mirror image of legislation already being sought by House Majority Leader Ken Martinez and Senate Majority Leader Michael Sanchez.
“That’s because we wrapped my bill up with Rep. Martinez’s,” Bandy said Tuesday, after the Voters and Elections Committee gave his bill a unanimous thumbs up.
The bill bearing Bandy’s name is more restrictive than the Martinez-Sanchez legislation. Whereas that bill would have required nonprofits to list donors who give more than $5,000 if the nonprofits participated in “electioneering,” Bandy’s bill would require the listing of any donors who gave more than $1,000.
The Bandy bill, like the Martinez-Sanchez one, defines “electioneering” as the naming of a political candidate in a piece of literature or a broadcast ad that targets the candidate’s constituency in the three months prior to a primary election and the three months prior to the general election. The nonprofits would have to provide a list of donors to the Secretary of State’s office.
Nonprofits have vocally opposed the bill for several reasons, including a concern that such a measure would abridge their right to free speech if they were required to list donors.
Some representatives of the nonprofits also have said the requirements set out in the legislation could cost them donors seeking privacy.
At the heart of the proposal is the notion that a nonprofit, as a recipient of tax-exempt status, ostensibly gets a public subsidy, Assistant Attorney General Phil Baca told the Independent last week.
That assumption allows the state to set conditions on nonprofits, said Baca, who had drafted the Martinez-Sanchez legislation.
Baca said much the same thing before the House Voters and Elections Committee on Tuesday morning.
“We’re sovereign so we can craft our tax code any way we want to,” he told lawmakers.
Baca admitted last week that the U.S. Supreme Court has struck down several states’ attempts to place conditions on nonprofits and that the proposed legislation would likely go to court if it were to become law.
The Bandy bill is part of a larger standoff between state lawmakers and New Mexico’s nonprofit community.
Last year several legislators lost their re-election bids after several nonprofits paid for and distributed flyers critical of them.
Three of the ousted lawmakers unsuccessfully sued the organizations. But those legislators and others – as well as state Attorney General Gary King – characterized the flyers as political campaigning.
The nonprofits that authored the flyers, including the Center for Civic Policy and SouthWest Organizing Project, said they strictly adhered to federal Internal Revenue Service rules for 501c(3) organizations and thus did not cross the line between issue advocacy and political campaigning. The flyers did not endorse a candidate, were sent out months before either the primary or general election and were meant to educate, the nonprofits said.
The line between issue advocacy and electioneering is made all the more hazy by New Mexico’s Campaign Reporting Act (pdf), which is vague about what constitutes political activity.
Bandy must present his bill to one more House committee — the House Judiciary Committee. If it passes there, it would go to the House floor for a vote. If it cleared the House, it would go to the Senate.
NMI’s Heath Haussamen contributed to this story.
