Know what you can—and can’t—do to help your favorite political candidates win election in November.

by Ralph Holmen, NAR Legal Affairs

This election year, REALTOR® associations and members may be considering ways to help their favorite candidates get elected. With legislation on smart growth, Internet taxation, and agency disclosure likely to hit local ballot boxes across the country in the coming year, REALTOR® involvement in the political process is as important as ever.

Vote, contribute, and volunteer!

First and foremost, all REALTORS® should go to the polls on Election Day. Members, associations, and AEs can also contribute to the REALTORS® Political Action Committee, which provides direct financial assistance to the campaign efforts of NAR-supported candidates at the local, state, and federal levels. Individuals can also volunteer their time and energies to their favorite candidate’s campaign directly.

But there are legal limitations on the federal campaign activities a REALTOR® association can engage in.

Know the limits on contributions, communications

The Federal Election Campaign Act generally prohibits incorporated associations from providing financial or other forms of assistance to federal candidates. Your state campaign finance laws may also prohibit your association from making campaign contributions or providing other forms of assistance to candidates for state or local office.

There are several exceptions to the ban on corporate campaign assistance to federal candidates; one of the most important permits corporations to communicate with specified individuals about federal elections.

In general, associations may communicate with members (as well as association staff and their families) on any political election subject, including express advocacy (“Vote for Smith for Congress”) or defeat of a candidate for federal office.

Associations can also encourage others to support a candidate, such as by making contributions to the candidate’s campaign or volunteering assistance to the campaign effort.

Communications to members may be made by any means, such as direct mail, fax, e-mail, publications, or phone banks, as long as the distribution is limited to the members, association staff, and their families. However, these communications can’t contain copies, in whole or in part, of campaign material prepared by the candidate. In fact, associations aren’t allowed to provide or distribute campaign material, such as buttons, bumper stickers, balloons, flyers, or any other materials that members might use in publicly expressing support for a candidate.

An association’s campaign communications should express only the association’s views and statements about the candidate.

Although associations can urge members to make campaign contributions to candidates, they can’t “facilitate the making of contributions to a federal candidate.” In other words, an association may not assist members in supporting a candidate by, for example, providing stamps or envelopes addressed to the candidate.

An association may endorse a candidate and communicate that endorsement to members, but only if such communication is not distributed outside that group. And associations may also announce endorsements publicly and state the reasons for the endorsement through a press release or a press conference as long as the press conference is provided only for the news media the association normally contacts, the expenditures associated with conducting the event are very small, and the announcement isn’t coordinated with the candidate or candidate’s representatives.

Declare what you spend

How much an association can spend on such communications isn’t limited; however, you must report what you spend to the Federal Election Commission if it exceeds $2,000 in any election. (For this purpose, the term “ election” refers to all primary or general elections.) Such reporting must be done if the association spends, for example, $1,500 on communications supporting candidate Smith and $800 on communications supporting candidate Jones, both of whom are running in primary elections but in different congressional districts.

Costs that must be reported include direct costs, such as printing, postage, paper, and telephone expenses, as well as the salaries and benefits of the staff involved. The reporting is done on FEC Form 7, available from the Federal Elections Commission (www.fec.gov); more details are provided at the RPAC Web site: http://www.onerealtorplace.com/rpacweb.nsf

Candidate appearances and fund raising

Associations may have a candidate or a candidate’s representative address members at a meeting, convention, or other function, and don’t need to give opponents the same opportunity to speak. The general public, however, can’t be invited to such an event.

The candidate may, at such a meeting, ask for contributions before, during, or after the meeting, but, again, the association may not participate in the collection process.

When it comes to events, associations can’t sponsor, organize, conduct, or otherwise engage in candidate fund-raising activities. More specifically, an association may not engage in fund-raising activities that involve officials or employees of the association, or their subordinates or support staff, in planning, organizing, or carrying out fund-raising projects as part of their work responsibilities. The use of association facilities without reimbursement of the association within a commercially reasonable time is also prohibited.

Although associations can’t hold fund-raisers for specific candidates, they can hold fund-raisers for RPAC. The RPAC Web site contains information on fund-raising ideas, legal issues, contribution limits, and other policies.

This article is not to be taken as legal advice. Associations should consult with counsel before engaging in political activity.

New Campaign Finance Disclosure Rules

State and local political action organizations are now required to disclose to the Internal Revenue Service the sources of the funds used for issue advocacy following campaign finance legislation enacted July 1, 2000. The new law imposes three IRS reporting and disclosure requirements on state and local REALTOR® association political action committees that have annual gross receipts of $25,000 or more. State and local associations are required to provide to the IRS information on their PACs, its officers, and board of directors, as well as contributors and expenditures. The first part of the disclosures were due July 31. For more information on the requirements, visit the IRS Web site at www.irs.gov, or call the IRS’s Exempt Organizations Customer Service, 877/829-5500.

Election Resources

1. The REALTORS® Political Action Committee Web site pictured below provides a wealth of information on fund-raising ideas, legal issues, contribution limits, and other policies http://www.realtorae.com/rpacweb.nsf

2. U.S. Federal Election Commission’s Campaign Guide for Corporations and Labor Organizations is available at www.fec.gov/finance_law.html

3. State Campaign Finance Law 2000, which includes detailed state-by-state summaries of state campaign finance laws, is available from the U.S. Government Printing Office at https://orders.access.gpo.gov/su_docs/sale/prf/prf.html; fax: 202/512-2250; or call the FEC Public Records Office, 800/424-9530 (press 3).