Welcome to Disclosure DigestFebruary 16, 2021Explore the legislation, litigation, and advocacy surrounding nonprofit donor disclosure with The Disclosure Digest, a Ballotpedia newsletter. Under federal law, nonprofits are generally not required to disclose to the public information about their donors. State laws, however, may require such disclosure. Some say expanded donor disclosure provisions minimize the potential for fraud and establish public accountability. Meanwhile, others say that disclosing to the public information about donors violates privacy rights and can inhibit charitable activity. Tennessee lawmakers consider bills limiting disclosure of nonprofit donor informationLegislation introduced last week in Tennessee would prohibit a public agency from disclosing identifying information about a nonprofit's donors. What the bill proposes SB1608 would bar any public agency (including state and municipal government units and courts) from:
The legislation does not bar public agencies from furnishing personal information about a nonprofit's donors, supporters, etc. pursuant to:
Under SB1608, a person alleging a violation of its provisions could file a civil action for relief, damages, or both. Damages would range from $2,500 to $7,500 for each violation. If enacted, the law's provisions would take effect on Oct. 1. Historical context: In 2020, Tennessee lawmakers introduced five bills similar to SB1608: HB1719, HB2396, HB2665, SB2293, and SB2886. All five bills would have prohibited public agencies from requiring 501(c) nonprofits to furnish them with personal information about donors. All five bills died in committee. Legislative status Sen. Paul Bailey (R) introduced SB1608 on Feb. 11. It has not yet been assigned to a committee. A companion bill – HB0159 – was introduced by Rep. Ryan Williams (R) in the Tennessee House of Representatives on Jan. 13. It also has not yet been assigned to a committee. The legislature adjourns May 6. Political context: Tennessee is a Republican trifecta, meaning that Republicans control the governorship and both chambers of the state legislature. Tennessee has been a Republican trifecta since 2011. Arguments There has been no media coverage of arguments for or against this bill. However, here's what we have seen for similar bills in other states. In 2018, Michigan lawmakers approved SB1176, which is similar to SB1608. In an op-ed for The Detroit News, Sean Parnell, vice-president of public policy for the Philanthropy Roundtable, wrote: "Michiganians are no stranger to anonymous giving, whether it’s the tens of millions of dollars given to support the Kalamazoo Promise or the numerous small anonymous gifts made through sites like GoFundMe.com. The Personal Privacy Protection Act ensures these and countless other acts of kindness can remain private if the giver wishes, while doing nothing to undermine Michigan’s laws regarding disclosure of campaign donations or punishing fraud by nonprofits. If Michigan wants to continue to encourage philanthropic giving, passage of this bill should be a priority..." The Campaign Legal Center's Erin Cholpak opposed the Michigan bill, writing: "While other states have been working to close loopholes that have allowed the increasing role of dark money in election campaigns, SB 1176 would codify those loopholes as enforceable law in Michigan. … And even if SB 1176 ultimately exempts campaign finance disclosure requirements from its broad disclosure ban, the bill will still make it easier for Michigan lawmakers to hide any conflicts of interest and could facilitate a rise of pay-to-play politics by shielding such arrangements from public scrutiny." Gov. Rick Snyder (R) vetoed SB1176. Similar legislation was also introduced last year in Iowa, Oklahoma, Tennessee, Utah, and West Virginia. The Utah and West Virginia bills were enacted. What other states are doing: At least three other states are considering similar legislation this year: Iowa (HF309, HSB28, and SSB1036), Nebraska (LB370), and South Dakota (SB103). All three states are Republican trifectas. What we're reading
The big pictureNumber of relevant bills by state: We're currently tracking 26 pieces of legislation dealing with donor disclosure. On the map below, a darker shade of green indicates a greater number of relevant bills. Click here for a complete list of all the bills we're tracking.
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