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Lobbying: Considerations for not-for-profits

lobbyingLobbying legislation exists federally, in some municipalities, and in all but one province. The upcoming release of Not–for–Profit PolicyPro includes substantial updates to NP—3.04—Lobbying, and examines lobbying legislation across Canada. There have been many recent changes in lobbying law. Some jurisdictions, like New Brunswick, have passed lobbying legislation, while other jurisdictions, like Ontario, have made significant changes to existing legislation. Here are four things not–for–profits must consider:

  1. Does the organization understand lobbying law? Lobbying law is not the same in every Canadian jurisdiction, so not–for–profits must comply with the law in the jurisdictions in which they operate. However, generally, lobbying refers to any contact with a public office holder (which includes public servants and politicians) in an attempt to influence law, policy or the award of grants, or other government benefits. Generally, not–for–profits are required to register and disclose details of lobbying activities in the applicable lobbying registry, if lobbying is a “significant part” of the duties of one or more employees, or paid director or officer. The threshold, or definition of what is “significant” varies by jurisdiction, as does the reporting frequency and content, and even who may submit the information to the registry.
  1. Do the letters patent, articles of incorporation, by–laws, strategic plans, funding agreements or contracts with others, place any limits on the lobbying activities contemplated by the organization?
  1. Does the organization understand the connection between lobbying, political activities and charitable activities? It is important to understand what activities are not considered lobbying, and to recognize that some of these activities may have other important implications for the organization. Certain activities may not meet the definition of lobbying, but may instead be considered political activities. If conducted outside the limits set by income tax law, political activities may jeopardize the organization’s status as a registered charity.
  • For example, a volunteer’s activities may not be considered lobbying under some lobbying statutes, because volunteers are unpaid. But if the volunteer’s activities meet the definition of political activities, the volunteer hours count toward the amount of organizational resources devoted to political activities. Recall that the general rule is that a charity can devote no more than 10 percent of its resources to political activities in a year. This is why NP—3.04—Lobbying also includes coverage of political activities by charities.
  1. Does the organization have processes and mechanisms to support registration and reporting obligations? Once an organization has contact with a public office holder it should track the basic elements of that contact.

The organization must determine whether the contact is exempt from registration or reporting obligations under lobbying laws. In some cases, this is clear, and the organization may not have to track much information. However, at minimum, organizations must still track enough information to support its assertion of exemption. This will be useful if, for example, there is ever a future investigation into whether these activities were in fact exempt.

In other cases, the contact is clearly, or likely, lobbying. The lines between activities that are exempt from lobbying law is even blurrier for organizations which have a lot of contact with public office holders as part of their charitable activities, on an ongoing basis. In these instances, organization must track information in more detail, including the “who, when, why, what, how and how much”, for example:

  • Which employees (or paid officer or director) carry out lobbying activities? Remember that lobbying activities include preparation, not just the contact with the public office holder.
  • Which third––parties (that is, consultant lobbyists) do the organization pay to carry out lobbying on its behalf?
  • Are consultant lobbyists paid with public funds? Ontario’s Broader Public Sector Accountability Act, 2010 prohibits specified public sector organizations from hiring consultant lobbyists using public funds.
  • Which agencies, minsters, or other public office holders were lobbied?
  • What was the subject matter of lobbying activities?
  • How much time was spent lobbying—including preparation time?
  • How many grassroots campaigns did the organization carry out? Grassroots campaigns refer to public appeals using mass media to encourage the public to pressure public office holders to endorse a particular position. Many lobbying statutes specifically include grassroots communication in the definition of lobbying.
  • What was the nature of the grassroots campaign?
  • When does lobbying occur? The thresholds to register are often calculated by reference to time periods, for example by evaluating how many hours of lobbying were carried out over a three month period.
  • How will the organization track and monitor timelines, thresholds and key dates related to registering and filing the required disclosures?

Read NP—3.04—Lobbying in Not–for–Profit PolicyPro for further information. Not a subscriber? Request a free 30–day trial here.

Apolone Gentles, JD, CPA,CGA, FCCA, Bsc (Hons)

Apolone Gentles is a CPA,CGA and Ontario lawyer and editor with over 20 years of business experience. She has held senior leadership roles in non-profit organizations, leading finance, human resources, information technology and facilities teams. She has also held senior roles in audit and assurance services at a “Big Four” audit firm. Apolone has also lectured in Auditing, Economics and Business at post-secondary schools.
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