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The Cost of Charity:

September 2, 2015

Yesterday the Goldwater Institute joined the Pacific Legal Foundation’s brief to the United States Supreme Court in a case that could decide the fate of free speech rights for nearly one million nonprofit organizations and charities throughout the country.

Goldwater joined the Pacific Legal Foundation and other organizations dedicated to individual liberty, constitutionally limited government, and free enterprise in an amicus brief asking the Supreme Court to protect charitable organizations from attempts to compel nonprofits to report the names, addresses, and contribution amounts of their donors to the government.

This case began in 2014, when California Attorney General Kamala Harris demanded that nonprofit groups organized under 501(c)(3) of the tax code, including the Center for Competitive Politics (“CCP”), turn over private donor information to the State.  This demand was made as a precondition to seeking charitable contributions in California. 

The AG insisted on this information in order to “efficien[tly]” monitor the activities of nonprofit organizations.  In other words, the chief law enforcement officer in California mandated that private charities disclose their private donors in order to get government permission to engage in constitutionally protected speech and association. 

CCP sued in federal court but lost an appeal in the Ninth Circuit. If allowed to stand, that decision will, in the words of CCP, “allow state governments to engage in the bulk collection of donor information from non-profit organizations,” without sufficient justification.

Unfortunately, California is not alone in her attempts to force private charities to turn over their donor information to the government.  Broad disclosure mandates are sweeping the country, threatening nonprofit organizations from nearly every sector and industry, representing views across the philosophical spectrum. 

In one particularly disturbing case, partisan government regulators in Wisconsin engaged in early morning swat raids on the homes of supporters to nonprofit organizations, where armed police poured into private residences, yelling orders, seizing private property, and instructing the residents to remain silent about the police investigation.  Ultimately, the Wisconsin Supreme Court put an end to these “John Doe” investigations, finding that government’s “legal theory is unsupported in either reason or law.”  But not before significant damage was done to the nonprofits subject to them, and their fundraising activities. 

As the John Doe case demonstrates, disclosure mandates are problematic for several reasons.  Namely, mandatory disclosure: (1) prevents public discourse from focusing on the message, rather than the messenger; (2) allows for retaliation against speakers by those who disagree, particularly for minority opinions or when speaking truth to power; and (3) muddles regulations so that no one knows what speech is permitted and what is not, thus further chilling speech.

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They are also unconstitutional.  Observing the vital link between freedom and the right to associate, the Supreme Court has long recognized a constitutional right to private association. 

During the Civil Rights era, in the seminal case on private association, the Court struck down an attempt by the Alabama Attorney General to force the National Association for the Advancement of Colored People (“NAACP”) to report the names and addresses of its members to the State.  The Supreme Court compared the “[c]ompelled disclosure of membership in an organization engaged in advocacy of particular beliefs” to a “requirement that adherents of particular religious faiths or political parties wear identifying arm-bands.”

As we have seen with the CCP case, however, lower federal courts have often failed to enforce these constitutional protections.  As a result, the Supreme Court should take this opportunity to pronounce that political privacy and association are unequivocally protected under the First Amendment.  Because 501(c)(3) nonprofit organizations do not engage in electoral politics, disclosure laws that reach their charitable activities are unconstitutional.  And when the government seeks to suppress speech, the burden should always be the government, not the speaker, to prove the limitation of speech is justified by a significantly important government interest. 

The Supreme Court should hear this case and recognize the fundamental principle that the Constitution protects the right of all Americans to support the causes we believe in without the fear of harassment and intimidation, and without the government looking over our back.      



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