Last week, the Alliance for Justice program Bolder Advocacy rolled out its latest guidebook for nonprofits and foundations, focused on how to set up or fund a 501(c)(4) group. Unlike the more common 501(c)(3), (c)(4) organizations can spend unlimited time and money on lobbying and political work, including some overtly partisan electioneering. In the past, (c)(4)s may have appeared off the table for major foundation grants, but as the report explains, foundations are perfectly capable of making legal grants to (c)(4)s, and it might be a better investment.
“Put simply, a 501(c)(4)’s ability to engage in partisan work can help to put the right people in office and support them once they get there,” the report states.
As the Bolder Advocacy report explains, (c)(4) groups may only use foundation funding for “nonpartisan social welfare” work. But they’re free to use donations from individuals and other (c)(4)s for both partisan and nonpartisan work, so long as the nonpartisan social welfare work remains the group’s “primary purpose.” The names behind individual donations also don’t have to be disclosed, making (c)(4)s a prime outlet for “dark money.” (In an interesting twist, liberals went from decrying dark money less than a decade ago to spending $260 million of it in 2020, nearly double that of their conservative counterparts.)
As Philip Rojc at Inside Philanthropy observed in 2019, progressive leaders and advocacy groups are increasingly seeking systemic changes, shifting their focus from strategies like education and litigation—the bread and butter of (c)(3)s—to electioneering and lobbying. The political pivot has led many established groups to launch their own (c)(4) wings or shift to a (c)(4) status, while new organizations increasingly avoid the (c)(3) option from the start.
Foundation grants to (c)(4) groups, the Bolder Advocacy report explains, are a win-win: that money can fund the nonpartisan work in which an organization must be engaged, which frees up the organization’s unrestricted funds for other work. In short, private foundations are more than capable of legally subsidizing overt partisan political activities, which many progressives have come to see as far more useful than traditional advocacy.
Many foundation leaders will probably start breaking out in hives just thinking about the tax implications of getting mixed up with electorally focused organizations. But as long as funders and nonprofits properly restrict grant money for appropriate uses (the Bolder Advocacy report explains best practices for this in detail), they’re both legally in the clear. While hesitation on the part of foundation leaders is understandable, the simple reality is that any funder focused on systemic, big-picture change must learn how to fold politics into their giving strategy.
Here at Blue Tent, a question we always seek to answer when evaluating a progressive organization is: Are they adapting to a changed landscape? Even long before Donald Trump descended his golden escalator on his way to the presidency, a number of the country’s most pressing problems were crying out for political solutions. The intractable legislative gridlock that grew out of the 1990s and reached its zenith in the Obama years could not be overcome by the limited lobbying and advocacy on which many progressive dollars were being spent. Such a strategy was even more hopeless in the face of a Republican-controlled congress, White House and judiciary post-2016.
Some of the most promising new progressive organizations founded in recent years have adapted to these new realities by tuning into the electoral arena with a c4 model.
Seeing the partisan blockades of Medicaid expansion at the state level, for instance, progressive operatives and labor leaders formed the Fairness Project in 2016. It uses ballot initiatives to bring progressive issues directly to the people, winning dozens of victories in blue and red states alike. Seeing the mobilization of women following Trump’s election, Leah Greenberg and Ezra Levin formed Indivisible, providing political guides and supporting local groups to channel their energy into grassroots activism. Seeing the complete takeover of the judiciary by Republicans, former political staffers Brian Fallon and Chris Kang formed Demand Justice in 2018, raising and spending millions of dollars to convince Democrats to prioritize judges and advocate major court reform legislation.
Overall, progressive leaders have built up an increasingly effective (c)(4) infrastructure since 2016—one that helped overcome massive voter suppression and unseat Donald Trump. If that infrastructure is able to scale further, it could advance the policy changes that activists and lawmakers have been seeking for decades. They just need the money to make it happen.