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U.S. Withdraws Rules Limiting Lobbying By Nonprofit Groups

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Washington--Regulations to strictly limit lobbying by organizations that receive federal funds were proposed by the Reagan Administration last January, but--following widespread protest from affected organizations here--the Administration formally withdrew the rules last week.

A revised version of the regulations will be issued by the Office of Management and Budget "in several months," a government spokesman said. The budget office had received more than 6,000 comments--many of them negative--from a wide variety of nonprofit, business, and professional groups, the spokesman said.

As published Jan. 24 in the Federal Register, the rules were designed to curb "political advocacy" by recipients of federal grants and contracts.

That term was broadly defined to include attempts to influence federal, state, or local elections or activities through: establishing political-action committees, organizing letter-writing campaigns, "communicating with" government officials, "participating in" litigation, and contributing to an organization "that has political advocacy as a substantial organizational purpose."

Separate Offices

The rules required federally funded organizations that devoted 5 percent or more of their office space to lobbying activities to maintain separate offices for the federally funded activities. Salaries of employees who engaged in lobbying, even on a part-time basis, could not be paid with federal money. The penalty for violating the regulations would be loss of the funds, or loss of the right to receive federal funds in the future.

Although the rules were said to apply equally to business and nonprofit groups, the latter groups--led by Independent Sector, a coalition of 450 groups--protested that they would be most adversely affected by the regulations because they generally operate under smaller budgets.

Education lobbyists are "quite concerned," said Albert D. Sumberg, president of the Committee for Education Funding, a lobbying coalition here. Mr. Sumberg said he is pleased that the budget office is revising the regulations, but he said he preferred that the regulations be eliminated altogether.

Indirect Effects

"Obviously, any education group that has federal money may be affected, but we may all be indirectly affected," said Mr. Sumberg, who is also associate general secretary of the American Association of University Professors."Organizations that get federal money--especially the smaller ones--may be prohibited from participating in coalitions" such as the education-funding committee, he added.

State and local governments were specifically exempted from the regulations. William Stevens, an attorney who analyzed the regulations for the American Association of School Administrators, said that the exemption included school systems and state education agencies.

Colleges were also exempted, although an analysis prepared by the American Council on Education said that universities that receive research or defense contracts might be affected.

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