****Update 4.21.22 – The House version of the bill (HB1201) was sent straight to the Calendar and Rules Committee yesterday (4.20.22) by the House Finance, Ways and Means Committee with zero discussion. The full House is scheduled to vote on the legislation today.
Image Credit: capitol.tn.gov
The Tennessee Conservative [By Jason Vaughn] –
An Amended Version Of A Caption Bill That Seeks To Have 501c4 Non-Profit Groups Report Expenditures Of $5000 Or More Made 60-Days Prior To An Election Has Been Passed By The Tennessee Senate With A 26 To 2 Vote In Favor.
The Republican sponsors of the legislation tout that the bill seeks to increase transparency for voters in Tennessee.
“The voters of Tennessee want more transparency in campaign finance. They want to know who’s behind the money, how they’re spending the money, because they’re trying to influence elections,” House Speaker and prime bill sponsor Cameron Sexton said.
However, many Conservatives have raised concerns that if this bill is meant to be about transparency, it is odd that the amendments that made the bill have only now been made available to the public on the General Assembly website, that the amendments were sneaked into an obscure caption bill and that when votes have been taken in committees, they were done by voice vote – meaning the public has no way to know how each of the legislators voted on the legislation until the final votes are taken on the House and Senate floors.
Senator Ferrell Haile (R-Gallatin-District 18), SB1005 co-sponsor, presented the bill yesterday (April 14th) on the Senate floor.
Regarding the bill, Haile said, “It is the product of over a year’s work between the Lt. Gov. McNally, Speaker Sexton, Representative Whitson and myself.”
Haile stated that a new amendment had been added to address the concerns about the implications for 501C4 non-profits.
Addressing the Senators, Haile said, “You had quite a few emails and concerns about the 501c4’s. What we’re doing here is taking the 501c-4, c-5, and c-6’s are required to report expenditures. They are not required to report their donors. This is only when a couple of things take place. One is that there is an aggregate total of expenditures of $5,000 dollars or more within (2nd part) sixty days of the election.” Haile specified, “This does not apply to lobbyists.”
Notwithstanding another law to the contrary, an organization that is tax exempt under United States Internal Revenue Service Code § 501(c)(4), (5), or (6) (26 U.S.C. § 501(c)(4), (5), or (6)) is required to report expenditures, in accordance with § 2- 10-105(c)(1) and (h) and file an appointment of treasurer form if:
(1) The organization expends an aggregate total of at least five thousand dollars ($5,000) in organizational funds, moneys, or credits for communications that expressly contain the name or visually depict the likeness of a state or local candidate in a primary or general election; and
(2) Such expenditures or communications occur within sixty (60) calendar days immediately preceding a primary or general election in which the named or visually depicted candidate appears on the ballot.
The previous amendment’s lead statement said:
Notwithstanding another law to contrary, an organization that is tax exempt under United States Internal Revenue Service Code 501C4 is deemed to be a political campaign committee for purposes of reporting expenditures in accordance with 2-10-105 C1 and for filing an appointment of treasurer form if: (next section same as new amendment)
The new amendment expanded the rule to include not just 501c4’s but also c5’s and c6’s. It also replaced the language “is deemed to be a political campaign committee for purposes of reporting expenditures” with “is required to report expenditures”
*** Click Here to Support Conservative Journalism in Tennessee. We can’t cover stories like this without your support!***
Senator Mike Bell (R-Riceville-District 9) stated that many of the concerns he has heard stem from Section 13b of the amendment that states “in accordance with § 2- 10-105(c)(1) and (h) and file an appointment of treasurer…”
“I think the concern is coming, at least from some of the advocacy groups, is the inclusion of ‘h’ and whether it does eliminate the requirement that contributions be recorded…. I think it is the (sponsor’s) intent that only expenditures be required but not contributions and I want to make sure that’s what this language is doing,” Bell said.
Haile stated that it does not include required contributions or donations reporting. “We talked with legal concerning this issue and they assure me that this is correct,” Haile said.
Senator Rusty Crowe (R-Johnson City-District 3) asked , “Just to be clear, TCA 2-10-105h does require contribution disclosure, you’re saying that this amendment that we’re passing today negates that and would require only expenditures disclosure?”
Haile replied, “That is correct.”
Senator Janice Bowling (R-Tullahoma-District 16) stated that she has received calls from across the state in opposition to the proposed legislation.
Bowling asked, “In a 501c4, the authorization for a 501c4 is to educate on issues and to advocate for certain positions. NRA, Right-to-Life, Americans for Prosperity – there are just many groups that are in opposition because it seems to eliminate their ability to advocate on issues or to educate regarding issues. They’re not asking you to vote for any one person….Right to Life, groups like that, send out report cards as they call them. Would these be prohibited sixty days out from an election?”
Haile said, “No, they would not be prohibited. They’d just have to be reported within that sixty-day time period. If they’re done prior to that sixty days, there’s no reporting whatsoever.”
Bowling asked, “So, they are allowed to use name, image or likeness, within sixty days of the election?”
Haile replied, “Yes they are but if they spend more than $5000, they have to report their expenditure but not donors.”
Bowling, “So, if they are using a name, image or likeness in the ordinary execution of their federally-authorized abilities, they would have to make an additional reporting to the state of Tennessee, to the Ethics commission?”
Haile answered in the affirmative. “It would be reported to the Bureau of Ethics and Finance. The answer is yes to that.”
Senator Kerry Roberts (R-Springfield-District 25) asked for some clarification by using an example, “Scorecards that are non-partisan in nature, they are issue-oriented. So, you’ve got a 501C4 that advocates for an issue and they publish a scorecard saying where all 33 of us may fit on an issue and they spend $5000 dollars to do this within sixty days of the election. That would be subject to this, even though it’s not partisan in nature or it’s not referencing a particular candidate. Do I understand that correctly?”
Haile replied, “That is correct.”
When the vote was taken 26 Senators voted in favor of the legislation with only 2 voting against.
Republican Senators voting Yes: Paul Bailey, Richard Briggs, Rusty Crowe, Todd Gardenhire, Ferrell Haile, Ed Jackson, Jack Johnson, Brian Kelsey, Jon Lundberg, Becky Massey, Frank Niceley, Bill Powers, Shane Reeves, Kerry Roberts, Steve Southerland, John Stevens, Art Swann, Bo Watson, Dawn White, Ken Yager and Randy McNally
Republican Senators voting No: Janice Bowling, Joey Hensley and Mark Pody
Lt. Gov. McNally stated that the bill had passed by constitutional majority and sounded the gavel with a motion to reconsider tabled.
The House version of the bill (HB1201) will next be heard in the House Finance, Ways and Means Subcommittee on April 19th, 2022. If you oppose or support this legislation, you can contact the Republican subcommittee member using the information below.
House Finance, Ways and Means Subcommittee – Republican Members
Gary Hicks (chair) (R)- email@example.com – (615) 741-7480
Charlie Baum (R)- firstname.lastname@example.org – (615) 741-6849
Ron Gant (R)- email@example.com – (615) 741-6890
David Hawk (R)- firstname.lastname@example.org – (615) 741-7482
Patsy Hazlewood (R)- email@example.com – (615) 741-2746
Susan Lynn (R)- firstname.lastname@example.org – (615) 741-7462
Brandon Ogles (R)- email@example.com – (615) 741-6808
Chris Todd (R)- firstname.lastname@example.org – (615) 741-747
Sam Whitson (R)- email@example.com – (615) 741-1864
Ryan Williams (R)- firstname.lastname@example.org – (615) 741-1875
About the Author: Jason Vaughn, Media Coordinator for The Tennessee Conservative ~ Jason previously worked for a legacy publishing company based in Crossville, TN in a variety of roles through his career. Most recently, he served as Deputy Director for their flagship publication. Prior, he was a freelance journalist writing articles that appeared in the Herald Citizen, the Crossville Chronicle and The Oracle among others. He graduated from Tennessee Technological University with a Bachelor’s in English-Journalism, with minors in Broadcast Journalism and History. Contact Jason at news@TennesseeConservativeNews.com