What needs to be reported under the new Massachusetts Lobbying Law?

The current provisions of the Massachusetts Lobbying Law were retained and augmented. As before Chapter 28, agents must report: all campaign contributions; all lobbying expenditures itemized if they exceed thirty-five dollars or more in any day.

“Such itemized accounting shall include, but not be limited to, specific expenditures for meals, gifts, transportation, entertainment, advertising, public relations, printing, mailing and telephone; and shall also include the names of the payees and the amount paid to each payee and shall further include the names of the candidate or political committee to whom or to which the contribution was made, and the amount and date of each contribution. When such expenditure is for meals, entertainment or transportation, said expenditure shall be identified by date, place, amount, and the names of all persons in the group partaking in or of such meal, entertainment or transportation. No expenditure shall be split or divided for the purpose of evading any provision of this section.’

Additionally, the law amended by Chapter 28 now requires the agent to report:

(1) the identification of each client for whom the legislative or executive agent provided lobbying services;
(2) a list of all bill numbers and names of legislation and other governmental action that the executive or legislative agent acted to promote, oppose or influence;
(3) a statement of the executive or legislative agent’s position, if any, on each such bill or other governmental action;
(4) the identification of the client or clients on whose behalf the executive or legislative agent was acting with respect to each such bill or governmental action;
(5) the amount of compensation received for executive or legislative lobbying from each client with respect to such lobbying services; and
(6) all direct business associations with public officials.

Lobbyists may not give more than $200 per candidate per year for state or local elections.

The disclosure shall be required regardless of whether the legislative agent or executive agent specifically referenced the bill number or name, or other governmental action while acting to promote, oppose or influence legislation, and shall be as complete as practicable.

How do I register to become a lobbyist

How do I register? Legislative and executive agents and lobbying entities register and report using an online system. Simply go to www.mass.gov/sec and click on the lobbyist reporting link. The reports are fairly straightforward but can take some getting used to. Many non-profits register and report in well under an hour per six-month reporting period. Make sure that email from lob@sec.state.ma.us is not caught in your spam filter! Additionally, lobbyists must now participate in an online or in-person training developed by the Secretary upon registration and annually thereafter. These trainings are currently being developed.

How much will it cost? Fees for registering as a legislative or executive agent (or both) are $100 and $100 for the “client,” i.e. the non-profit organization that employs the lobbyist. Some fees may be waived for non-profits. You must request a waiver in writing. Lobbyist entities like lobbying firms pay $1,000 plus an additional fee for each lobbyist they employ.

What are the 11 exemptions to the Massachusetts Lobbying Law?

These exemptions are only applicable to executive lobbying.

They are:

  1. a request for a meeting, a request for the status of an action or any similar administrative request, if the request does not include an attempt to influence a covered executive official;
  2. an act made in the course of participation in an advisory committee or task force;
  3. providing information in writing in response to a written request for specific information by an officer or employee of the executive branch or an authority, including, but not limited to, statewide constitutional officers and employees thereof;
  4. an act required by subpoena, civil investigative demand, or otherwise compelled by statute, regulation or other action of the executive branch or an authority, including, but not limited to, statewide constitutional offices;
  5. a communication made to an officer or employee of the executive branch or an authority, including, but not limited to, statewide constitutional officers and employees thereof, with regard to: (1) a judicial proceeding or a criminal or civil law enforcement inquiry, investigation or proceeding; or (2) a filing or proceeding that the executive branch or an authority, including, but not limited to, statewide constitutional offices, is specifically required by statute or regulation to maintain or conduct on a confidential basis; if such executive branch or authority, including, but not limited to, statewide constitutional offices, is charged with responsibility for such proceeding, inquiry, investigation or filing;
  6. an act made in compliance with written agency procedures regarding an adjudicatory proceeding, as defined in section one of chapter thirty A, conducted by the agency, or similar adjudicatory or evidentiary proceedings conducted by any department, board, commission or official not governed by chapter thirty A;
  7. a petition for action by the executive branch or an authority, including, but not limited to, statewide constitutional offices made in writing and required to be a matter of public record pursuant to established procedures of such executive branch or authority, including, but not limited to, statewide constitutional offices;
  8. an act made on behalf of an individual with regard to that individual’s benefits, employment or other personal matters;
  9. a response to a request for proposals or similar invitation by an officer or employee of the executive branch or an authority, including, but not limited to, statewide constitutional officers and employees thereof, for information relevant to a contract;
  10. participation in a bid conference;
  11. an appeal or request for review of a procurement decision.

What is the definition of a legislative agent and an executive agent?

This information pertains to the new Massachusetts Lobbying Law.

  • Legislative agent“, a person who for compensation or reward engages in legislative lobbying, which includes at least 1 lobbying communication with a government employee made by said person.
    • The term “legislative agent” shall include a person who, as part of his regular and usual business or professional activities and not simply incidental thereto, engages in legislative lobbying, whether or not any compensation in addition to the salary for such activities is received for such services.
    • For purposes of this definition a person shall be presumed to be engaged in legislative lobbying that is simply incidental to his regular and usual business or professional activities if he: (i) engages in legislative lobbying for not more than 25 hours during any reporting period; and (ii) receives less than $2,500 during any reporting period for legislative lobbying.
  • Executive agent“, a person who for compensation or reward engages in executive lobbying, which includes at least 1 lobbying communication with a government employee made by said person.
    • The term “executive agent” shall include a person who, as part of his regular and usual business or professional activities and not simply incidental thereto, engages in executive lobbying, whether or not any compensation in addition to the salary for such activities is received for such services.
    • For the purposes of this definition a person shall be presumed to engaged in executive lobbying that is simply incidental to his regular and usual business or professional activities if he: (i) engages in executive lobbying for not more than 25 hours during any reporting period; and receives less than $2,500 during any reporting period for executive lobbying.

What is the new Massachusetts lobbying law?

Chapter 28 of the Acts of 2009, “AN ACT TO IMPROVE THE LAWS RELATING TO CAMPAIGN FINANCE, ETHICS AND LOBBYING” is the most sweeping change in the ethics and lobbying laws in decades. Changes in the lobbying sections will have widespread impact in the advocacy community.

The term legislative lobbying and executive lobbying are defined in the new law more specificity than in the past. Prior to the change, lobbying was not separately defined, but in other sections was referred in very broad terms such as “any act to promote, oppose or influence legislation, or to promote, oppose or influence the governor’s approval or veto thereof.”
Here is what the new law says:

  • Legislative lobbying,” any act to promote, oppose, influence or attempt to influence legislation, or to promote, oppose or influence the governor’s approval or veto thereof including, without limitation, any action to influence the introduction, sponsorship, consideration, action or non-action with respect to any legislation; provided further, that legislative lobbying shall include acts to influence or attempt to influence the decision of any officer or employee of a city or town when those acts are intended to carry out a common purpose with legislative lobbying at the state level; and provided further, that legislative lobbying shall include strategizing, planning and research if performed in connection with or for use in an actual communication with a government employee; provided, however, that “legislative lobbying” shall not include providing information in writing in response to a written request from an officer or employee of the legislative branch for technical advice or factual information regarding any legislation for the purposes of this chapter.
  • Executive lobbying,” any act to promote, oppose, influence, or attempt to influence the decision of any officer or employee of the executive branch or an authority, including but not limited to, statewide constitutional officers and employees thereof, where such decision concerns legislation or the adoption, defeat or postponement of a standard, rate, rule or regulation promulgated pursuant to any general or special law, or any act to communicate directly with a covered executive official to influence a decision concerning policy or procurement; provided further, that executive lobbying shall include acts to influence or attempt to influence the decision of any officer or employee of a city or town when those acts are intended to carry out a common purpose with executive lobbying at the state level; and provided further, that executive lobbying shall include strategizing, planning, and research if performed in connection with, or for use in, an actual communication with a government employee; and provided, further, that “executive lobbying” shall not include providing information in writing in response to a written request from an officer or employee of the executive branch or an authority for technical advice or factual information regarding a standard, rate, rule or regulation, policy or procurement for the purposes of this chapter.

Note that there are 11 exemptions to the executive lobbying. These exemptions were in previous law and apply to executive branch lobbying only.

In short, the definition of lobbying – in both the legislative and executive branches is quite broad. It is a broader category than who needs to register and informs both the question of who needs to register and what needs to be reported.

NOTE: This interpretation of the law, based on our extensive involvement with its passage, has no legal authority. Under the statute, the Secretary of the Commonwealth (the Secretary) has primary responsibility to enforce and interpret the law. This document is not intended as a substitute for seeking oral advice, or requesting an advisory opinion, from the Secretary pursuant to M.G.L. c. 3, s. 41. Furthermore, in the interest of clarity this memo does not delve into all of the legal nuances of the law, yet another reason to seek advice.

What nonprofits need to register for new lobbying regulations?

The law continues to require that certain individuals who are paid to lobby register and report their activities. Lobbying entities and organizations must also register and report. Unpaid volunteers, regardless of how much they lobby, do not have to register.

Anyone who must register as a lobbyist is referred to as a “legislative agent” if she or he engages in legislative lobbying and as an “executive agent” if he or she engages in lobbying the executive branch on a policy, rate, rule, or procurement decision.  (See definitions).

What are some of the main regulations nonprofits need to be concerned about complying with?

What are the different types of Nonprofit Organizations?

The federal government has distinguished between the different types of nonprofit organizations based upon their tax code designations. The list below cites the type of nonprofit organization and the corresponding tax code.

Please see the IRS 557 for detailed information on the differing regulations and requirements for nonprofits.

The following organizations are all exempt from income tax and are thus considered to be “nonprofit” by the federal government. 501(c)(1) Corporations Organized Under Act of Congress (including Federal Credit Unions):

  • 501(c)(1) – These are corporations organized under Act of Congress. Federal Credit Unions are a good example of this type of nonprofit. These nonprofits do not have to file an annual return. Tax-exempt contributions are allowed if they are made for exclusively public purposes.
  • 501(c)(2) – These are holding corporations for exempt organizations. That is, they can hold title to property of an exempt group. They apply for nonprofit status using IRS form 1024. They annually file forms 990 or 990EZ.
  • 501(c)(3) – This is the most common type of nonprofit. Generally, almost all donations made to 501(c)(3) organizations are tax-deductible.  It includes organizations that are religious, educational, charitable, scientific, and literary; groups that test for public safety, that foster national or international amateur sports competition; or organizations engaged in the prevention of cruelty to children or animals. There are five types of 501(c)(3) organizations:
  1. Private Foundations. These are nonprofits that don’t qualify as public charities. Foundations may be sub-classified as private operating foundations or private non-operating foundations, and receive some of the advantages of public charities.
  2. 509(a)(I) are publicly-supported charities.
  3. 509(a)(2) are exempt purpose activity-supported charities.
  4. 509(c)(3) are supporting organizations for 509(a) or 509(a)(2) charities.
  5. 509(a)(4) are public safety charities.
  • 501(c)(4) – These are civic leagues, social welfare organizations, and local associations of employees. They promote community welfare, charitable, education or recreational goals.  These nonprofits are often less restricted in lobbying than 501(c)(3)’s.
  • 501(c)(5)- Labor, agricultural, and horticultural organizations fit under this classification. They are educational or instructive, with the goal of improving conditions of work, and to improve products and efficiency.
  • 501(c)(6) – These organizations are business leagues, chambers of commerce, real estate boards, etc. They seek to improve business conditions.
  • 501(c)(7) – Social and recreation clubs fall into this category. They promote pleasure, recreation, and social activities.
  • 501(c)(8) – This category includes fraternal beneficiary societies and associations. They provide for the payment of life, sickness, accident, or other benefits to members.
  • 501(c)(9) – These are voluntary employees’ beneficiary associations. They provide for the payment of life, sickness, accident, or other benefits to members.
  • 501(c)(10) – Domestic Fraternal Societies and Associations. A lodge devoting its net earnings to charitable, fraternal, and other specified purposes. No life, sickness, or accident benefits to members.
  • 501(c)(11) – Teacher’s Retirement fund Associations. Associations for payment of retirement benefits.
  • 501(c)(13) Cemetery Companies. Loans to members.
  • 501(c)(14) – State Chartered Credit Unions, Mutual Reserve Funds.  Loans to members.
  • 501(c)(15) – Mutual Insurance Companies of Association. Provide insurance to members, mostly at cost.
  • 501(c)(16) – Cooperative Organizations to Finance Crop Operations. Finance crop operations in conjunction with activities of a marketing or purchasing association.
  • 501(c)(17) – Supplemental Unemployment Benefit Trusts. Provides for payment of supplemental unemployment compensation benefits.
  • 501(c)(18) – Employee Funded Pension Trust (created before June 25, 1959). Payment of benefits under a pension plan funded by employees.
  • 501(c)(19) – Post or Organization of Past or Present Members of the Armed Forces. Activities according to the nature of organization.
  • 501(c)(20)- Group Legal Services Plan Organizations.
  • 501(c)(21) – Black Lung Benefit Trusts. Funded by coal mine operators to satisfy their liability for disability or death due to black lung diseases.
  • 501(c)(22) – Withdrawal Liability Payment Fund. Provides funds to meet the liability of employers withdrawing from a multi-employer pension fund. No form to file. Tax forms 990 or 990EZ.
  • 501(c)(23) – Veterans Organization (created before 1880). Provides insurance and other benefits to veterans.
  • 501(c)(25) – Title Holding Corporations or Trusts with Multiple Parents. Holding title and paying over income from property to 35 or fewer parents or beneficiaries.
  • 501(c)(26) – State-Sponsored Organization Providing Health Coverage for High-Risk Individuals. Provides health care coverage to high-risk individuals.
  • 501(c)(27) – State-Sponsored Workers’ Compensation Reinsurance Organization Reimburses members for losses under workers’ compensation acts.
  • 501(d) – Religious and Apostolic Associations. Regular business activities. Communal religious community.
  • 501(e) – Cooperative Hospital Service Organizations. Performs cooperative services for hospitals.
  • 501(f) – Cooperative Service Organizations of Operating Educational Organizations. Performs collective investment services for educational organizations.
  • 501(k) – Child Care Organizations. Provides care for children.
  • 501(n) – Charitable Risk Pools. Pools certain insurance risks of 501(c)(3).
  • 521(a) – Farmers’ Cooperative Associations. Cooperative marketing and purchasing for agricultural producers.

How do I start my own nonprofit organization?

The process of starting a nonprofit organization generally involves:

  1. drafting bylaws which sets forth the structure of the organization and creates a governing board with final authority for the organization,
  2. incorporating as a nonprofit corporation in the state of choice,
  3. obtaining tax-exempt status from the IRS and the state in which the organization is based, and
  4. completing additional documents relating to state compliance, annual reporting requirements, newly instituted IRS compliance policies, and sound corporate record-keeping practices.

Developing bylaws and a board of directors. After discussion with the client regarding the purposes of the organization, options for structuring and comprising the board of directors, and basic operational and administrative mechanisms, we will draft the bylaws and an explanatory memorandum which outlines the most important points. A key, often-overlooked point of emphasis is the composition of the board of directors. In particular, it is important to carefully select the initial directors and determine the manner by which future directors are selected.

Incorporation. In most states this is a relatively simple procedure. The Articles of Incorporation generally include a number of the provisions already set forth in the bylaws.

Obtaining tax-exempt status from the IRS. The application and follow-up responses to the IRS are the most time consuming part of the process. Generally, the two substantive pieces of information required by the IRS are:

  • A statement of activities detailing, as specifically as possible, the proposed activities of the new organizations.
  • Estimated budgets for three years*

Below are some useful resources on how to begin the process of establishing your nonprofit organization:

*Source: Hurwit & Associates Nonprofit Law Resource Library.

How do I support the nonprofit sector and organizations?

Many nonprofits are looking for additional assistance and support. We recommend you reach out to the nonprofit organization and start a conversation about the organization’s goals and challenges to determine what issues are most critical for the nonprofit. The nonprofit may need help organizing itself, finding donations, reaching out to the community, or reaching out to legislators. The process of establishing and solidifying a nonprofit organization is complicated, but there is always something you can do.

We recommend that you explore opportunities are available for those who want to help a nonprofit organization, as well as the sector as a whole: