2015 Texas Legislative Summary for nonprofits – Last-day-of-session report

As the haze of the 140-day 2015 legislative session lifts, winners and losers come into view—bills that passed, that almost passed, should have passed or died due to some parliamentary or procedural circumstance. Equally important is to consider groups of dead bills that reflect an issue, idea or constituent base that will be back in 2017 for another try.

The complete June 1, 2015 SUMMARY OF ISSUES AFFECTING NONPROFIT ORGANIZATIONS is available here, and will be updated when the Governor’s veto period has lapsed and effective dates of passed bills can be listed.

During the coming hot summer, there will be time to reflect on the effect of new laws on nonprofit organizations, state associations, foundations and local volunteer leaders. Some items of interest:

Disputes over regulation of “dark money” activities of nonprofits crash the legislature’s omnibus ethics bill

Ethics reform legislation was a stated goal of Governor Abbott, and almost everyone in the Pink Building agreed that an omnibus ethics bill would evolve and pass. Senate Bill 19 became the lead ethics bill, but one lingering difference between the House and Senate versions was never resolved: Additional statutory regulation of donations to nonprofit organizations (primarily Section 501(c)(4) tax-exempt entities) that might later be directed to public advocacy or political activities.

The House version of SB 19 was returned to the Senate with language from earlier bills, HB 37 and HB 38 (see legislative summary referenced above), requiring that names of some donors would have to be disclosed, and that the “persons or groups” receiving these funds could be characterized as a political committee, whether called that or not, and thus subject to filing and other regulations under the Texas Elections Code.

Senate sponsors of the bill signaled that this language was not acceptable to them on First Amendment constitutional grounds. On the 138th day of the session, House and Senate conference committee conferees could not agree on this point, and SB 19 was not returned to the floor of either house.

News accounts in the coming weeks may paint a picture of questionable non-transparent nonprofit organizations that need reforming, but the issues run much deeper.

State agency fee collection check-offs will generate charitable donations for groups and causes with friends in the legislature

Several bills passed in the 2015 Texas legislative session indicate that there are other ways to raise funds for a charitable cause than simple grass-roots hard work. Several bills require various state agencies to provide a check-off box at the time a state fee is paid, with additional funds listed by a payer to become a donation to a specific charity or cause designated by legislative preference.

There’s nothing inherently wrong with finding new ways to raise funds for good causes. But it might be a good idea in the long run for the legislature not to designate recipient charitable organizations by name to avoid picking winners in the fundraising game (and losers, too).

Some examples:

  • SB 272: When registering a motor vehicle and paying fees, a revised DMV form would permit a donation of additional funds to the Special Olympics.
  • HB 3710: When applying for a license to carry a concealed handgun, the state form would include space to donate additional funds to a veteran’s assistance fund managed by the state.

Unpaid interns get some legal rights 

Many organizations rely heavily on volunteers and unpaid interns—usually college students or community service assignments—to manage operational duties. These unpaid assistants or trainees often are the backbone of smaller organizations. It’s fair to ask, how much is too much dependence on well-intentioned unpaid interns, and what might result when there’s an unhappy ending to the relationship that sends an intern to an attorney’s office?

HB 1151 passed the House and Senate and has been sent to the Governor. It was not expected to pass but did, possibly because there are more grievances out there among organizations than we know. The bill adds provisions to the Texas Labor Code granting unpaid interns the same legal protection against on-the-job sexual harassment as paid employees. Most interesting of all, the bill provides a definition of what is an unpaid internship, with new Labor Code Section 21.1065.

Read the entire June 1 legislative summary here.

© 2015 Richard W. Meyer, All Rights Reserved


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