by Jini Stolk
When one of the non-profit sector’s most authoritative online journals covers the Canada Revenue Agency’s “intrusive and damaging audits” of certain nonprofits you know you’re in trouble.
The Nonprofit Quarterly’s story Newspapers protest attack-by-audit of Canadian charities notes that as many as 52 charitable organizations had come under CRA scrutiny by the end of 2014, thanks to special funding ($13.4 million through 2019) to enforce rules limiting charities’ “political” or “partisan activity”.
This may have been news in the States, but not to those of us who’ve been following the stream of stories and exhaustive reports about the defunding, delisting, and auditing of Canadian charities – many which had been critical of government policies and perspectives. The Watershed one of PANAMANIA’s signature presentations, explores the closing of a federally funded, internationally renowned freshwater research station and the impossibility of getting anyone in government to go on record about the reasons.
And so we wonder…and worry…and fear the consequences of speaking out. I’ve seen highly intelligent, informed and progressive board members helping to institute policies that curb their organizations’ voice on issues core to their missions. I’ve known boards to worry about the funding repercussions of presenting politically-themed works of art.
Admittedly, part of a board’s “duty of care” is to ensure that their charity’s actions don’t lead inexorably to being shut down by the CRA – but isn’t self-censoring abandoning our role as an alternative voice to that of power or perceived truths?
It can be very persuasively argued that advocacy is an essential board responsibility. BoardSource’s new edition of its classic Ten Basic Responsibilities of Nonprofit Boards just added advocacy to their list, arguing that our missions are too important to sit on the sidelines; we – experts in the field on issues that matter deeply to society’s future – are the people decision-makers need to hear from.
Let’s figure out exactly what we’re dealing with. CRA has set out its understanding of political activities in its published policy CPS-022, which acknowledges that Canadian charities have experience, expertise and ideas that should be used to help government develop better public policies and programs. Imagine Canada has written a clear and helpful piece differentiating between permitted activities, like public awareness campaigns; partisan political activities, that are strictly forbidden; and limited political activities, that should take up no more than 10% of a charity’s resources. Limited political activity, which is much more circumscribed than in most other jurisdictions:
- explicitly communicates a call to political action (that is, encourages the public to contact an elected representative or public official and urge them to retain, oppose, or change the law, policy, or decision of any level of government in Canada or a foreign country);
- explicitly communicates to the public that such laws, policies, or decisions should be retained, opposed, or changed;
- explicitly indicates in internal or external materials that the intention of the activity is to incite, or organize to put pressure on an elected representative or public official to retain, oppose, or change any such laws, policies, or decisions; or
- involves the making of gifts to qualified donees intended for political activities.
Law firm Miller Thomson’s non-profit and charitable wing has clearly outlined what you should do to keep track of political activities, and what to do if you are faced with an audit in which your percentage of political activities might be under question.
Remember that the CRA leaves plenty of room for charities to analyze issues that affect our communities; communicate with and inform elected and government officials; and let people know where elected officials stand on issues as indicated by their public statements or voting records (as ArtsVote does so well). Also note that these rules only apply to charities, not nonprofit organizations, and might be another incentive to forming non-charitable organizations (like the Ontario Nonprofit Network) and unincorporated coalitions to tackle crucial issues.
As for arts organizations who are struggling to maintain the power and freedom of their voice, I think I’ll refer (again!) to the Pope who, in his recent passionate calls for economic justice, fairness, equity and dignity, has been described by the ED of the Institute for New Economic Thinking as “singing to the music that’s already in the air. And that’s a good thing. That’s what artists do…”
Canadian charities and political activities: Keeping room temperature in a chilly environment – Part one
CRA and the Political Activities Audit – an Update