The Subcommittee on Oversight of the House Ways and Means Committee heard testimony from supporters and opponents of two bills that would allow religious organizations to endorse candidates and spend funds on partisan electioneering activities. H.R. 2357, sponsored by Rep. Walter Jones (R-NC), would exempt religious organizations and their affiliates from the tax code’s prohibition on intervention in candidate campaigns, allowing them to be involved in partisan electioneering if it is not a “substantial part” of their overall activities. H.R. 2931, sponsored by Rep. Phillip Crane (R-IL), is similar, but proposes a “bright-line” definition of how much partisan activity a religious group could be involved in. It would allow religious organizations to spend up to 5% of their budget on electioneering, but no more than 20% on both lobbying and electioneering. Non-cost items, such as volunteer efforts, would not count toward the total, and would be unlimited. The witness panel was lead by IRS Exempt Organizations Director Steven Miller, who testified that current law does not prevent religious organizations from speaking on issues, as claimed by the bill’s supporters. He noted that in the 25 years since the prohibition was enacted only two churches and five affiliates of religious groups have lost their 501(c)(3) status for intervening in elections. In response to a question from Ranking Member William Coyne (D-PA), Miller said under the proposed bills little information on political contributions to religious groups would be available, since they are not required to apply for recognition of tax-exempt status or file Form 990, the annual information return filed by most nonprofits. Religious groups were clearly divided about the need for the bills, or their desirability. Rev. James Kennedy of Coral Ridge Ministries and the Hon. Rev. Walter Fauntroy, Pastor of Bethel Baptist Church in Washington, D.C. speaking in favor of the bills, said the current limitations on religious groups are unconstitutional and prevent them being heard in the political process. However, Rev. C. Welton Gaddy, director of the Interfaith Alliance Foundation, opposed the bills, saying they would alter the relationship between government and religion, inviting intrusive regulation of church affairs. Brenda Girton-Mitchell, speaking on behalf of the National Council of Churches, supported this view, saying “The church must speak on worldly issues from the deep places of faith, but must not lend the voice of faith to temporal interests.” Campaign finance issues were addressed through testimony and questions, with Rep. Coyne asking if allowing partisan campaigning by religious groups would create a large campaign finance loophole. Rev. Barry Lynn of Americans United for Separation of Church and State agreed that this would be a problem, noting, “There are many churches and related organizations with multi-million dollar budgets. A typical so-called "mega-church" with a $2 million budget under H.R. 2931 could contribute $100,000 to partisan campaigns. Under H.R. 2357, that same church could send $225,000 to favored politicians. If the Southern Baptist Convention or the Unification Church's entire budget was taken into account, such entities could spend over $1 million dollars on electioneering.” Colby May of the American Center for Law and Justice disputed this interpretation, saying that campaign finance law would prevent direct contributions from religious groups to candidates. His position does not account for rules that allow groups to make independent expenditures or create separate segregated funds for campaign spending. No date for committee consideration of the bills has been set. See OMB Watch’s comments on the bills and a full summary of the bills. You can also weigh in on our online poll. See also Joint Committee on Taxation summary of present law rules.