Lee Signs Tennessee Campaign Finance Reform Bill into Law with Reporting Requirements for Nonprofits

by Jon Styf


Tennessee Gov. Bill Lee signed a campaign finance reform bill on Friday that adds reporting requirements for political action committees, political candidates and some nonprofits.

Senate Bill 1005 went to conference committee before being approved by the Legislature on April 28 before being signed by both speakers and sent to Lee on May 18.

The bill will require 501(c)(4), 501(c)(5) and 501(c)(6) nonprofits to report expenses of more than $5,000 spent on communications with the image or name of candidates on them in the final 60 days before an election.

A 501(c)(3) nonprofit, such as the Salvation Army or Red Cross or Habitat for Humanity cannot engage in political activity. A 501(c)(4) nonprofit, however, can.

The bill provides exceptions to the rule for nonprofits including for communications to members, lobbying during a special session and communications to groups, such as Facebook followers, who have opted in to receive communications.

The bill will require political candidates to provide a report of all expenditures over $100 and set a cap on non-itemized expenses at $2,000 per statement period.

Those reports would be posted on the state’s campaign transparency website.

As the bill passed the Legislature, Lt. Gov. Randy McNally, R-Oak Ridge said that the bill “does not censor or otherwise curtail conservative activism or free speech in any way.”

“Anything conservative groups can do now, they can still do under this bill,” McNally said. “The legislation does not restrict their activity at all. The only additional requirement is disclosure.

“Openness and transparency in the political process are prerequisites for freedom. For too long liberals, big corporations and corrupt political actors have been allowed to exploit loopholes in our system and operate in darkness.”

McNally said that the bill was “aimed at bad actors like the fictitious Matthew Phoenix and the various shell companies and shadowy PACs used by certain legislators to line their own pockets.”

Matthew Phoenix is the name allegedly used by former House Speaker Glen Casada’s former Chief of Staff Cade Cothren, identified as being part of a political mailer scheme in an FBI investigation of former Rep. Robin Smith, R-Hixson, who later resigned.

“It is amazing that various seemingly ‘legitimate’ groups are resorting to such disingenuous tactics to oppose it,” McNally said. “Is it because they are spending so much that Tennesseans would be appalled if they knew? Or is it that they spend so little that they fear they would be exposed as political grifters working to enrich only themselves?

“If you are working to influence the outcome of an election, the voters deserve to know who you are and what you are doing. What could possibly be wrong with that? The fact this is even in question demonstrates the need for the legislation.”

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Jon Styf is an award-winning editor and reporter who has worked in Illinois, Texas, Wisconsin, Florida and Michigan in local newsrooms over the past 20 years, working for Shaw Media, Hearst and several other companies.
Photo “Bill Lee” by Bill Lee. 


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