Support of godly candidates muddies tax exempt status

COMMUNITY IMPACT - Voter guides on the windshields of cars parked at the Desert Vineyard Christian Fellowship during church services endorse candidates who enjoy the favor of the Community Impact Committee. Valley Press photo by Bart Weitzel.

This story appeared in the Antelope Valley Press November 4, 2000.

By BOB WILSON
Valley Press Staff Writer

PALMDALE - A group of local Christian clergy and school leaders go to great lengths to influence the outcome of local elections, blurring a line between church and state-sanctioned political activity and muddying the question of tax-exempt status.

The group is the Community Impact Committee, "a group of Christian business people and ministers who are trying to get Christian leaders elected to local office," in the words of organization chairman Cecil Swetland.

"Specifically, my view, as chairman, is I would love to see every single elected school board, hospital board, water district board - any of those groups - have committed Christians that are gifted in those areas and who are leaders serving on them," said Swetland, executive director of Desert Christian Schools in Lancaster.

In other words, the group takes to heart Democratic vice presidential nominee Joseph Lieberman's call for a role for active religionists and the exercise of faith in the nation's political life.

Swetland is allowed to voice his opinions on a call for Christian leadership in elective office under the First Amendment. And that is the same law that, according to the U.S. Supreme Court, sets a barrier to protect churches from government interference and to protect the government from religious control.

Under federal tax law, religious-based schools such as the one Swetland oversees must refrain from endorsing or opposing specific candidates for public office or risk losing their nonprofit tax status.

The same holds true for churches, charities and other types of organizations and entities holding federal 501(c)3 tax code status.

While allowed to sponsor impartial voter-registration drives and neutral candidate forums, a church or religious school may not indicate a bias for or against any candidate based solely on whether he or she subscribes to the church or school's religious philosophies, according to the Internal Revenue Service.

Nonprofit churches and religious schools also are barred from distributing literature or statements "rating" any candidate according to religious philosophies, IRS information shows.

Because churches and schools are prohibited from endorsing candidates, a number of local religious leaders and community members formed the Community Impact Committee in an apparent effort to get around the constitutional wall that separates church from state.

Dating back to the April 1998 Lancaster City Council election, the group interviewed political candidates, rated and endorsed them in accordance with CIC philosophies and named them on handbills that volunteers place on the windshields of cars parked outside churches during services.

From its activities, the CIC appears to act as a political committee that should register with the state of California, according to Rob Boston, spokesman for Americans United for Separation of Church and State, a Washington, D.C., organization that opposes organized partisan political activity by churches, religious organizations and religious committees.

David Prather, senior pastor at Central Christian Church in Lancaster and a member of the CIC leadership board, rejected Boston's description, calling the group an informal collection of interested parties who believe in the election of "godly candidates."

"It isn't a political action committee. It's a bunch of people from the community who want to have an influence on the people running for office," Prather said.

Interesting proposal. It's a committee. Its purpose is to influence politics. It's not a PAC?

Boston disagreed with Prather's view, noting, "Either you exist or you don't. If you're taking funds, or if you are paying for things, then you are talking about an organization that does exist and does have activity.

"You can't claim an organization is not political when being political is its main purpose for existence," Boston said.

"If there are political materials being produced, the states have strict regulations on how money is spent on behalf of political candidates.

"A church or another nonprofit is not supposed to be handing out endorsements and not bothering to declare the costs. And if this is benefiting specific candidates, it is the equivalent of in-kind contributions."

The CIC works with spirit to endorse candidates and spread the news.

Under California law, committees created primarily to support or oppose specific candidates or ballot measures must register with the state and file reports on income and expenditures.

Those committees must file if they are composed of "any person or combination of persons who directly or indirectly" receive contributions totaling $1,000 or make expenditures totaling $1,000 during any calendar year, according to the state Fair Political Practices Commission.

Besides cash, the definition of contribution to or expenditure on behalf of a committee includes payments by a third party on behalf of the committee, the forgiveness of a loan to the committee or a third-party repayment of a loan to the committee.

The $1,000 state limit is based on the fair-market value of the goods or services contributed or purchased, not on reduced rates not generally available to the public.

According to Swetland, the CIC will distribute approximately 18,000 handbills for the Tuesday, Nov. 7, election. Asked if the cost of those handbills will be reported, Swetland said the expense "was next to nothing."

"I paid for this voter guide," spending $530, he said. "Other times, the printing was donated or it was printed for free. ... The CIC doesn't have bank accounts."

Swetland declined to name the businesses that donated the previous printing or paid prior handbill costs, saying, "I would be afraid to leave anybody out."

The state requires a committee to identify itself only if that expense hits $1,000 a year, he said, "and we won't be anywhere close to that. This is the most we've ever spent."

Still, Swetland's $530 expenditure for this November's election did not include the cost of the handbills distributed for two other elections held in the past 12 months, one is March and another last November.

Swetland said the group distributed about 13,000 handbills for the March primary election and about the same number for the November 1999 Palmdale City Council campaign.

The cost of all three pieces would still fall short of the state's $1,000 level, he said, without providing specifics. "For this particular election, the $530 bill is higher than what we normally pay."

Steve Benen of Americans United for Separation of Church and State said the endorsement handbills created and distributed by the CIC seem to be "inviting a visit by the IRS."

If the CIC's membership includes ministers who help pass the group's endorsements along to their congregations, "they may well fall within the letter of the law," Benen opined.

Pastors "are not supposed to be endorsing candidates from the pulpit," he said. "The federal tax laws ask them not to intervene in elections, and that would be a clear intervention."

If the IRS determines a tax-exempt organization is engaged in prohibited campaign activity, that organization could lose its exempt status or could be subject to an excise tax on the amount of money spent on political activity, said Chris Conley, spokesman with the agency's media office in Laguna Niguel.

Conley declined to offer an opinion on whether the CIC actions were within tax laws. Rulings are only made after formal investigations are conducted on a case-by-case basis, he said.

Prather offered a different point of view on the matter.

"Churches can't endorse, but I can," he said adamantly. "There's a difference, and everyone understands that.

"I could stand in front of my congregation and from my pulpit I could say, `I want you to know I'm voting for George W. Bush,' and there is no conflict for me to say that," Prather proclaimed. "There is a world of difference between what I do as a pastor and what the church does. It's the church that cannot be involved in endorsing."

Involvement by the CIC "is not a church-sponsored deal," he said. "It is our right. The church isn't doing it. The Community Impact Committee is."

The CIC does not ask churches for permission to distribute its endorsements, "they just do it," Prather continued. "If we don't get a complaint, we keep doing it. Most people don't complain."

Asked whether a lack of complaint could be considered implied consent and participation by churches - particularly by churches whose pastors also are members of the CIC - Prather bristled.

"No, they are not involved; they are not doing it," he emphasized. "This is not something sponsored by the churches, nor are the churches involved. Individuals are."

"A church cannot give permission" to the CIC to distribute its endorsements, Swetland noted. "This is the opposite, where we wait for a church to say they'd rather not be involved."

Most churches do not complain because other people, including peddlers, distribute handbills and fliers during services, he said. "Most people don't worry about things left on their car windows."

Not all are willing to follow the footsteps of Prather and Swetland.

Bob Sobo, pastor of Harvest Community Church in Palmdale, is among the 12 pastors and 36 community members named on the CIC's letterhead. On Thursday, Sobo said he would prefer his name be removed.

"I believe it's not my place to give a spiritual stamp of approval to candidates that I don't know personally," Sobo said.

"I never was consulted on any of the particular endorsements made" by the CIC, the pastor said. "I found out that I was `endorsing' these candidates when a flier was put on my car.

"My belief is that my congregation should be praying themselves and seeking God's direction, becoming as involved as they can so they can make their own decisions," Sobo said. "I've been very careful with my congregation not to make political endorsements, even when I desired to.

"I believe that when a pastor makes a personal public endorsement of a candidate, if his congregation thinks well of him, then they will be very inclined to support the candidate the pastor has endorsed," he said. "That, then, creates a confusing area in terms of the laws regarding nonprofit status.

"I would rather take a stance of praying that God's man or woman be elected, whoever that might be, rather than for me to identify who God's man or woman is. I do not believe that is my role as the pastor of a church.

"However, all that having been said, I do agree with the spiritual and community views held by the CIC."

The Rev. Dr. C. Welton Gaddy, a Baptist minister and executive director of the Interfaith Alliance, shares Sobo's opinion.

The Interfaith Alliance, a multifaith organization based in Washington, D.C., is running advertisements in newspapers throughout the country encouraging clergy members to remain neutral in this year's campaign.

In those ads, the alliance is "calling on people of faith to reject partisan voter guides" distributed at their houses of worship, particularly the guides generated by the Christian Coalition.

According to the alliance, the coalition's one-page leaflets "use inflammatory questions describing controversial issues to urge Christian voters to blatantly favor one party's candidate over the other."

Besides being prohibited under federal tax laws for distribution by nonprofit agencies, such voter guides are "bad for religion and bad for politics," Gaddy said.

"To us, distributing materials cloaked in the language of faith ... does not constitute voter education, but instead, voter indoctrination," Gaddy says in alliance ads. "We believe that using the language and symbols of faith to advance a partisan political agenda is just plain wrong."

Again, Prather disagreed and defended his own church's Oct. 29 distribution of voter guides created by the Traditional Values Coalition of Anaheim.

The guides rated candidates seeking election to the U.S. presidency, the U.S. Senate and House and the California Senate and Assembly based on the Traditional Values Coalition's assessment of where candidates stood on the issues of, among other things, abortion, prayer in schools, homosexual marriage and funding of private schools with taxpayer money.

According to the IRS, such rankings, if they "encourage people to vote for or against a particular candidate on the basis of partisan criteria, nevertheless violate the political campaign prohibition of section 501(c)3."

Prather claimed the guides "ranked" candidates without favoritism.

"There is no problem (in) doing that. That is what (the guides) are produced for, to be used in churches for educating the congregation," Prather said. "I guarantee there is no problem with that. They are printed up by the tens of thousands and go out all over the state."

But the IRS has issued statements warning churches about endorsements distributed under the guise of voter education materials. The agency points out that in 1988, it rejected a request by the Association of the Bar of the City of New York for 501(c)3 status specifically because it ranked candidates for elective judicial office according to bar association criteria.

After reviewing the CIC's handbills, Gaddy said, "It seems like a smart way to get around what is legally and ethically proscribed for religious leaders.

"Ministers have a right to speak their minds outside their houses of worship," Gaddy said. "But the key criterion would be: Is there an implication that this list of endorsed candidates is who the faithful ought to support?"

His concern stemmed from the CIC's identifying some of its members as pastors and itself as a supporter of "godly" candidates, he said.

"The suggestion is that the other candidates are not the godly candidates" and therefore unworthy of the support of pastors' congregations, Gaddy said.

"There is a legal question to be answered here so there is no ambiguity about whether the pastor is lending his name as an individual or as a leader of a congregation," Gaddy said.

On its handbills, the CIC lists its address as a post office box number. Its telephone number is that of Swetland's office at Desert Christian Schools.

According to guidelines offered by the Interfaith Alliance, nonprofit churches and schools are barred from providing anything of value to a political candidate or cause - including space, equipment and staff time - without charging the full-market value and allowing equal access to all other candidates and points of view.