How much does the nation’s largest teachers’ organization spend on politics each year? According to forms that the National Education Association files with the Internal Revenue Service, not a penny. That’s right. Nothing. Zilch.
But Mark R. Levin, the executive director of the Kansas City, Mo.-based Landmark Legal Foundation, doesn’t buy it. How, he asks, can the NEA tell the IRS that it doesn’t spend anything on politics when reams of internal NEA documents list scores of politically related expenditures and activities?
“They are involved in political activities, and they’re proud of it, and they brag about it,” he said of the 2.5 million-member union. “But they just refuse to own up to it when it comes to filing their forms.”
For example, Landmark points to a $350,000 item in an NEA budget document for “training programs and materials designed, developed, and tested that strengthen organizational capacity to support the election of pro-public education candidates.” Another item in the same document similarly describes expenditures of $872,000 over two years for developing “a comprehensive, state-specific campaign. ... aimed at electing bipartisan pro-education candidates.”
To Mr. Levin, the apparent inconsistencies show a clear attempt to play fast and loose with the law, and Landmark, a conservative group that has battled the NEA over school vouchers, has let the IRS know as much in a complaint it filed this summer.
The NEA counters, however, that Landmark is keying in on legitimate, nontaxable expenditures and that the union’s practices are both legal and appropriate.
Whether the IRS agrees won’t be known for some time—or perhaps ever, because the agency’s investigations and any resulting penalties are kept confidential. But the case highlights the sometimes slippery definitions of political expenditures, and shows that what a group considers to be politics in one context often is not considered politics in another.
Member to Member?
While conceding that much of what the union does would be viewed as political activity by the layperson, NEA officials say there’s nothing hypocritical about the way they fill out the association’s tax forms.
Though federal election rules say that a political contribution is any expenditure aimed at swaying the general public toward a specific candidate, it is not considered to be a contribution when a group communicates with its own members on political matters.
So if FEC rules allow unions to spend their regular dues money on political communications with their membership, the NEA argues, then it needn’t report that as political spending to the IRS.
What Landmark has done, argues the NEA’s general counsel, Robert H. Chanin, is dredge up lists of expenditures related to member communications and claimed they fit the definition of a political contribution.
“The NEA produces more documents than an entire Third World country, and if you go through enough thousands of pages, you’re going to find particular phrases, which, taken out of context, look like ‘Aha! you’ve crossed the line,’” he said. “But all of the money that we have expended in what they’re complaining about has been expended to communicate with our members, which is allowable.”
Landmark isn’t convinced.
“That answer just doesn’t cut it,” Mr. Levin said. “I can assure you that they’re not spending tens of millions of dollars just to send out fliers to their members.”
Moreover, Landmark contends that the IRS’s definition of reportable political activity isn’t restricted solely to the kind of political contributions regulated by the FEC.
Edward Coleman, a Washington tax lawyer who has been hired by Landmark, formerly headed the IRS office that dealt with tax-exempt organizations. “Based on what I looked at [in the union’s documents], it certainly would raise my eyebrows if I were at the IRS to initiate an examination,” he said.
Whatever the ultimate legal status of its practices in the eyes of the federal tax agency, the NEA has plenty of company. The smaller American Federation of Teachers and other labor organizations also report to the IRS that they make no taxable political expenditures.
On one area of campaign spending, however, the NEA appears to have diverged from what is commonly practiced by many similar groups.
A separate Landmark complaint, filed with the FEC at the same time that the foundation began pushing for an IRS inquiry, points out that a handful of the union’s affiliates have this year put notices on their Internet sites announcing their endorsement of Vice President Al Gore, the Democratic nominee for president.
For example, a section added earlier this year to the Web site of the California Teachers’ Association told visitors: “CTA’s State Council of Education has concurred with NEA in its decision to name Vice President Al Gore as the recommended candidate for the 2000 presidential primary.”
The problem with such notices, Landmark contends, is that they are accessible to anyone with a computer and a modem. In short, those statements represents communication beyond the union’s members.
“The NEA is free to communicate its endorsements to its membership,” Mr. Levin said.
“But,"he added, “when you put it on a Web site, and make it publicly available to the whole wide world, the FEC views that as political advertising.”
Many advocacy organizations are, in fact, careful not to put such political messages out on the wide-open portion of the Internet.
A notice on the National Rifle Association’s home page tells visitors: “Unfortunately, election laws severely restrict the information we can make available to nonmembers, so we are unable to post our recommendations to the Web site.”
Similarly, the AFT requires its members to enter a special password-protected section of its Web site to learn about its endorsements. Indeed, a 1997 FEC advisory opinion suggests that an organization “could endorse, or solicit contributions for a candidate via its Web site only if it uses a method (such as passwords) to limit access to these messages. ...”
Pointing out that such an opinion doesn’t hold the force of law, however, NEA officials maintain that the FEC has yet to fully clarify the issue.
Moreover, NEA lawyers say, the federal rules that define a political expenditure as anything of value beg the tough question of how much money is expended when a group puts a notice on an existing Web site.
“What the FEC is struggling with now is that they developed a lot of rules and regulations for hard copy,” Mr. Chanin said. “We believe we’ve complied with the law, but it’s a murky area.
“By the time of the next election cycle,” he continued, “there won’t be these problems, because there will be new, clear rules that address the kinds of technology that we’re using.”