Disclosure Bill Clears House Committee

Politically active nonprofits would be required to disclose their donors under a bill that passed handily out of a House committee Wednesday.

Senate Bill 346, by state Sen. Kel Seliger, R-Amarillo, would target nonprofits that fall under section 501(c)(4) of the tax code. That section was created for groups involved in “social welfare” work but are allowed to engage in political activity as long as that's not their primary activity. In the 2012 election cycle, groups that used the 501(c)(4) designation spent more than $300 million influencing elections, according to the Center for Responsive Politics.

The bill came to the House after an unusual episode in which the Senate passed the measure 23-6 before attempting to recall it, by an equally lopsided vote, a day later. The bill, though, had already been sent to the House, where it was taken up by the House State Affairs Committee. Now, the bill must pass through the House unamended if it is to avoid returning to the Senate. The bill passed out of committee, unaltered, with a 12-0 vote. It will now go to the full House for consideration.

At Wednesday's committee hearing, the bill’s House sponsor, Rep. Charlie Geren, R-Fort Worth, said that the disclosure requirements – similar to ones lawmakers are subjected to – were common sense.

“If it’s good enough for us, it should be good enough for them,” he said. “And if you’re embarrassed about where you’re getting your money, you ought to not take it.

Geren stressed that disclosure requirements had been repeatedly ruled constitutional by the U.S. Supreme Court – even in the court case that recently helped unleash a torrent of money into the American political system, Citizens United v. Federal Election Commission.

Fred Lewis, a lawyer and campaign finance activist, testified that transparency was the sole safeguard of the state’s election system.

“In Texas, we do not have public financing of campaigns, and we do not have contribution limits,” he said. “All we have is disclosure.”

Committee members seemed unified in opposition to the political influence of 501(c)(4) groups, with some lawmakers discussing their personal experiences with the activities of such groups. State Rep. Patricia Harless, R-Spring, produced two letters she said had been mailed to her home over the weekend.

“One of these is trashing me on a vote, telling people what a terrible legislator I am,” she said. “And the other is from the exact same group, asking for money. It says, ‘When legislators aren’t foolishly spending your money, they’re devising ways to hide doing so.’ So I would think that these groups must be supportive of this legislation, because it doesn’t seem like they want us hiding things.”