Advocacy represents an important element of philanthropy, leveraging our voices to effect change. As part of ongoing effort to provide support and programming on advocacy, we've compiled resources that can aid you in starting and continuing the conversation around this topic in your work to prevent and end homelessness. We will be updating this page with timely resources as they become available, so be sure to check back often!
Funders Together Policy Priorities
We believe philanthropy has a voice in addressing homelessness and advancing solutions to prevent and end it with Congree and the Presidential administration. As Funders Together to End Homelessness prepares to work with the administration, together with our national partners we are focused on continuing to make preventing and ending homelessness a bi-partisan priority.
How Would Terminating USICH Affect Efforts to End Homelessness? Preliminary Findings from Interviews with Federal Agencies, Communities, and Advocacy Organizations
This brief, by the Urban Institute and funded by FTEH members, including the Conrad N. Hilton Foundation, Melville Charitable Trust, Bill & Melinda Gates Foundation, Kresge Foundation, and Butler Family Fund works to understand the US Interagency Council on Homelessness’s (USICH’s) role in the nation’s efforts to end homelessness and potential effects of the agency’s planned termination in 2017.
The Legal Limitations on Advocacy
Funders can and should be advocates for policies and funding streams that can end and prevent homelessness. Understand the legal restrictions on private foundations’ advocacy efforts with this resource.
Webinar: Advocacy - The Funder's Role
Now is the time to strategize how we can best use our resources as funders to help advocate for innovative and effective solutions to ending and preventing homelessness. In this webinar, we examine the various roles a funder can take to advance advocacy efforts at all levels: local, state, and federal.
Webinar: Advocacy 101 for Funders
In this webinar, the Alliance for Justice leads us on a continued learning journey around various ways foundations and United Ways can partake in advocacy to effect change. We defined lobbying and the limitations in place for different types of funders, shared examples of unique and effective ways Funders Together members engage in advocacy, and examined ways your grantees can become involved.
Funders Together Resources
As part of an ongoing effort to provide support and programming on advocacy, we've compiled resources that can aid you in starting and continuing the conversation in your work to prevent and end homelessness.
Funders can and should be advocates for policies and funding streams that can end and prevent homelessness. Understand the legal restrictions on private foundations’ advocacy efforts with this resource.
While there are numerous policies that may affect homelessness services and prevention, we stand behind these key policy principles.
From Our Members
Campion Foundation - Advocacy Spectrum and Tools
Published by Council on Foundations, this report explains “lobbying” versus networking and includes a step-by-step guide to contacting policymakers.
This report from the National Committee for Responsive Philanthropy discusses best practices and the impact of philanthropic dollars devoted to advocacy.
Funders in Action: An Example of Funder Advocacy
Texas education grantmakers knew that they needed to act when the state government cut $5.4 billion from the education budget in 2011. Funders began seeing the impacts quickly; requests for grants increased dramatically from organizations that used to receive support from public schools and public-private partnerships were in danger of falling apart. In response, funders formed the Texas Education Grantmakers Advocacy Consortium (TEGAC) to push back against the massive spending cuts. Because the group was focused on the budget -- and did not get into political ideologies or education reform debates -- it was able to convene and mobilize an unprecedented number of grantmakers throughout Texas. TEGAC also invested $100,000 in research to help shape the public narrative. The programs affected by the budget cuts were the same programs that studies proved to be effective! In May 2013, the Texas legislature reinstated $4 billion out of the $5.4 billion in education funds. Although TEGAC did not take credit for the restoration of funding, the mobilization of funders and the broad support for advocacy had a tangible statewide impact. Read more about this story here.
Please contact Amanda Andere if you would like to discuss advocacy issues further.
We believe philanthropy has a voice in addressing homelessness and advancing solutions to prevent and end it with Congress and Presidential administration. As Funders Together to End Homelessness prepares to work with this administration, together with our national partners we are focused on continuing to make preventing and ending homelessness a bi-partisan priority. To accomplish this, we are focused on the following:
This page will serve as a collection of information that will continually be updated with new reports, fact sheets, websites, and other resources that support these priority areas.
1. Housing stability is an issue that affects education, health, and work force development. We believe in expanding the supply of housing, including affordable housing, and strengthen connections of these efforts with others to foster better health, economic mobility, and educational achievement.
- Government funding for programs that affect housing stability is critical as philanthropy cannot do it alone. In late March 2018, a budget was passed for FY18 and includes many highlights for the work to end homelessness. Here are some key takeaways from the most recent budget (via the National Alliance to End Homelessness):
- $4.4 billion increase to the ten largest HUD accounts which is the largest one-year increase in the last 20 years.
$130 million increase to HUD Homeless Assistance grants which is estimated to move an additional 20,000-25,000 people into housing.
- Section 8 renewals are fully funded for both project-based Section 8 and vouchers. In addition, there are funds for new "incremental" vouchers: $40 million for HUD-Veterans Affairs Supportive Housing (VASH) for veterans with disabilities experiencing homelessness, $20 million for the Family Unification Program (FUP), and ~$385 million for 811 vouchers for individuals with disabilities.
- $800 million increase to Public Housing
- $400 million increase to HOME Investment Partnership Program (HOME)
- $300 million increase to Community Development Block Grants (CDBG)
- 12.5% increase in Low-Income Housing Tax Credits (LIHTC)
- Funders Together has created a Priorities for the New Congress and Administration messaging guide. This document reflects 2017-2018 messaging but is in the process of being updated with FY19 language. However, it can still be used to understand how we plan to lift up philanthropy's voice, role, and influence. It can also be used as a messaging guide for your own advocacy efforts. Download the Word document here for easy editing. Check back soon as we will be updating this as we learn more.
2. Early intervention that stops the cycle of homelessness and poverty is critical for youth and young adults.
- As a founding member of A Way Home America we believe the following transition priorities will be critical to systems change needed to provide a more stable future to our youth. The A Way Home America Transition Plan identifies actions and strategies necessary to prevent and end youth and young adult homelessness. The Transition Plan is intended to inform the next Presidential Administration, federal appointees, and members of congress on our collective goals to end youth and young adult homelessness.
3. Strengthening the connections between employment services and homelessness services to both prevent homelessness and ensure that exits from homelessness are permanent, stable, and successful.
As a funder, how can you take action?
If you are a public foundation or United Way and can engage in direct lobbying, here are some action steps you can take:
- Sign up for the National Alliance to End Homelessness’s Advocacy Updates and take action by contacting public officials. Feel free to use the Priorities for the New Congress and Administration Messaging Guide for language around public-private partnerships and modify it to fit your foundation’s message.
- You can also participate in non-lobbying advocacy efforts. See examples below.
If you are unable to partake in direct lobbying efforts, here are some advocacy efforts you can participate in:
- Consider facilitating conversations between your grantees and public officials. Use your convening power to host a philanthropy-led bipartisan town hall where grantees can talk about their work and philanthropy can feature the nature of its investment and how philanthropic dollars can’t be expected to “fill the gap”.
- Write targeted op-eds in key communities. Philanthropy’s voice is important when talking about public-private partnerships. Highlighting work being done in key areas can have a ripple effect and educate community members and public officials alike. If you are interested, contact Funders Together and we can identify these key communities and assist with your op-ed strategy.
- Fund small emergency advocacy grants. Consider asking grantees about how a small emergency advocacy grant could be used to help with their efforts around strategy, communications, or grassroots engagement.
Learn more about the "Cans" and "Cannots" of being a funder involved in advocacy and lobbying efforts and get more ideas of action steps you can take through our "Advocacy - A Funder's Role" webinar.
If you have any questions regarding our transition priorities, or have a resource to share, please feel free to contact Amanda Andere at email@example.com.
The amount of legislative activity that is permissible for a section 501(c)(3) organization is dependent upon both the organization’s classification—that is, whether it is a “public charity” or a “private foundation”—and its size. Part I of this memorandum briefly describes the definition of legislative activities (i.e., lobbying) generally. Parts II and III address how much lobbying activity public charities and private foundations can engage in without jeopardizing their tax-exempt status. Part IV describes the interplay of the lobbying limitations in the context of private foundation grants to public charities that lobby.
Part I: Definition of Legislative Activities
An activity engaged in by a section 501(c)(3) organization, including advocacy, is treated as a legislative activity only if it is an attempt to influence legislation.
Lobbying activity may include attempting to influence legislation through direct contact with the relevant legislative body or indirectly through “grassroots” activities (i.e., lobbying aimed at persuading members of the general public to contact their legislative representatives.) Thus, a 501(c)(3) organization is generally regarded as attempting to influence legislation if the organization advocates the adoption or rejection of legislation by (a) contacting members of a legislative body (or their staff) with respect to legislation; or (b) urging the public to contact members of a legislative body with respect to legislation.
Legislation need not be introduced in the legislature for an organization to be treated as engaging in lobbying activities with respect to legislation. Rather, lobbying also includes specific legislative proposals that are either favored or opposed by the organization, even if they have not yet been introduced.
Legislation also includes the confirmation of administrative appointees, Congressional resolutions, state and foreign legislation, local and city council legislation, and referenda and ballot measures. It does not, however, include regulations or actions exclusively within the executive branch.
An organization can be treated as lobbying (or influencing legislation) even if it does so through an agent or gives money to another for the purpose of facilitating lobbying. (See Part IV of this memorandum, below.)
Not all activities that touch on legislative issues are treated for tax purposes as attempts to influence legislation. Educational activities that touch on legislative issues, but are objective and do not have a purpose of advocating for a particular position are not treated for tax purposes as attempts to influence legislation. For example, the publication of scholarly studies, or of objective, nonpartisan analyses of legislative proposals, will not necessarily be treated as restricted legislative activity even if these studies or reports endorse a particular position. On the other hand, the Internal Revenue Service (IRS) has taken the position in some cases that educational activity that is otherwise proper becomes improper (i.e., legislative) where the purpose of such activity is the active advocacy of some specific legislative program.
In addition, providing technical assistance at the request of the legislature by responding to a request to provide testimony at a congressional hearing is not treated as lobbying. Discussion with legislators of broad social or economic problems also does not constitute lobbying, as long as the discussion does not address the merits of specific legislation.
It is very difficult to draw bright lines in this area, and even a comprehensive review of the decided cases and rulings would be of limited help, because the determinations of the IRS and the courts tend to be very fact-specific.
As a general proposition, however, it can be said that 30-second TV spots or newspaper ads that advocate a particular position, that are one-sided, that do not present backup data or opposing viewpoints, and that are timed to tie into legislators’ or voters’ consideration of legislative proposals, will be vulnerable to attack as not being “educational” within the meaning of the Treasury regulations.
While a section 501(c)(3) organization may be able to engage in legislative activities described above, it cannot engage in any political campaign activities. Section 501(c)(3) organizations are not allowed to participate in, or intervene in, any political campaign on behalf of (or in opposition to) any candidate for public office, regardless of their tax classification as a public charity or private foundation. Even de minimis participation in a political campaign would jeopardize the organization's status as a section 501(c)(3) organization and/or result in the imposition of an excise tax upon the organization.
Part II: Permissible Legislative Activity by Public Charities
The Substantial Activities Test
The category of so-called “public charities” includes those charitable and educational organizations that enjoy a broad base of public financial support. Prominent examples would be the American Red Cross, the American Cancer Society, and the United Way. Such organizations are permitted to engage in legislative activity—both “direct” and “grassroots” lobbying—so long as such activity is not “substantial” in relation to the organization’s overall activity. What constitutes “substantial” activities has never been defined with any precision; as the IRS likes to say, it depends on all the “facts and circumstances” of the particular case. At least one decided case suggests that activity that represents less than five percent of an organization’s overall activity will not be considered substantial.
How legislative activity is to be measured is another unanswered question. Certainly, financial expenditures, both direct expenses and reasonably allocated overhead, will be considered. In addition, time spent by volunteer workers and other factors may also be considered in particular cases.
The Section 501(h) Safe Harbor
Because of the uncertainty regarding the scope of legislative activities that a public charity may engage in before those activities are treated as “substantial,” public charities often elect, under section 501(h), to have their legislative activities measured by a mathematical formula. As a result, the section 501(h) election effectively provides a safe harbor for permissible legislative activities. For an electing organization, the permissible amount of legislative activity is then determined by reference to the organization’s overall “exempt purposes” budget, as follows:
If overall budget is
The permissible lobbying limit is
Not over $500,000
20% of the exempt purpose expenditures
Over $500,000 but not over $1,000,000
$100,000 plus 15% of the excess of the exempt purpose expenditures over $500,000
Over $1,000,000 but not over $1,500,000
$175,000 plus 10% of the excess of the exempt purpose expenditures over $1,000,000
$225,000 plus 5% of the excess of the exempt purpose expenditures over $1,500,000
There is a statutory maximum lobbying limit of $1 million per year.
Of the amounts determined under the foregoing formula, 100% may be spent on so-called “direct lobbying” (i.e., lobbying directed at the persons who will vote on the legislation, which in the case of ballot initiatives includes the voting public). Under a separate statutory limitation, only 25% of whatever amount is determined under the foregoing formula can be spent on “grassroots lobbying” (as defined above).
Part III: Legislative Activity by Private Foundations
Private foundations are section 501(c)(3) organizations that typically have, and are supported by, investments and endowments producing income used for grant-making purposes and that do not receive substantial financial support from the general public. Private foundations, as a subcategory of section 501(c)(3), are defined in section 509 of the Code. Prominent examples are the Bill & Melinda Gates Foundation, the Ford Foundation, and the Rockefeller Foundation.
Pursuant to sections 4940 through 4946 of the Code, private foundations are subject to a series of significant restrictions that do not apply to public charities. Among these restrictions, section 4945 imposes an absolute prohibition on engaging in legislative activities. In other words, private foundations, unlike public charities, are not allowed to engage in legislative activity even to an insubstantial extent. The penalty for violations of these rules can range from tax penalties, measured by the amounts improperly expended for prohibited activity, up to revocation of the organization’s tax exemption (in certain cases of repeated or flagrant violations).
However, private foundations may engage in advocacy that is not treated as a legislative activity, such as permissible “educational” activity described in Part I of this memorandum. In addition, a private foundation will not be treated as attempting to influence legislation in discussions with governmental officials provided that:
- The subject of the discussions is a program which is jointly funded by the foundation and the government or is a new program which may be jointly funded by the foundation and the government;
- The discussions are undertaken for the purpose of exchanging data and information on the subject matter of the program; and
- Such discussions are not undertaken by foundation managers in order to make any direct attempt to persuade government officials or employees to take particular positions on specific legislative issues other than such program.
Part IV: Private Foundation Grants to Public Charities that Lobby
Amounts expended by a private foundation’s public charity grantees for lobbying activities can be attributed to the private foundation in certain circumstances. In particular, attribution can (and is likely to) occur when the foundation has earmarked its grant funds to be used to finance the lobbying activity in question. Of course, whether sufficient “earmarking” has occurred to result in attribution may be clear in some instances and not in others. The IRS has not developed specific rules to determine whether earmarking has occurred; rather, a facts and circumstances test is applied.
There are two types of grants that would ordinarily be permitted (i.e., the grants will not be treated as impermissible attempts to lobby by the private foundation):
- General support grants, so long as the grant is not earmarked to be used by the recipient public charity in attempts to influence legislation; and
- Specific project grants, so long as the grant is not earmarked to be used in an attempt to influence legislation and the sum of all grants made by the private foundation for the same project for the same year does not exceed the amount budgeted, for the year of the grant, by the grantee organization for activities of the project that are not attempts to influence legislation. In such a situation—setting aside the fungibility of money—the argument is that none of the foundation’s funds have been used for lobbying.
1 All section references are to the Internal Revenue Code of 1986, as amended (the “Code”) unless otherwise specified.
2 Treas. Reg. § 1.501(c)(3)-1(c)(3)(ii).
3 Treas. Reg. § 1.501(c)(3)-1(c)(3).
4 The Treasury regulations include an example in which a private foundation publishes a report on the use of pesticides, which concludes that the disadvantages of using pesticides are greater than the advantages and that prompt legislative regulation of pesticides is needed. The example concludes that the report is within the exception for nonpartisan analysis since it presents information on both sides of the legislative controversy and presents a sufficiently full and fair exposition on the pertinent facts to enable the public or an individual to form an independent opinion or conclusion. Treas. Reg. § 53.4945-2(d)(1)(vii), ex.2.
5 See Seasongood v. Commissioner, 227 F.2d 207 (6th Circ. 1955) (finding that legislative activities were not substantial).
6 Section 4911(c)(2).
7 Section 4911(c)(4).
8 Treas. Reg. § 53.4945-2(a)(3).
9 Treas. Reg. § 53.4945-2(a)(5)(i).
10 Treas. Reg. § 53.4945-2(a)(6)(i).
11 Treas. Reg. § 53.4945-2(a)(6)(ii).
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Our sincere thanks to Covington and Burling LLP for their pro bono support in the creation of this resource.