Gov. Roy Cooper has vetoed a measure that would keep charitable donors’ personal information private.
“This legislation is unnecessary and may limit transparency with political contributions,” Cooper said in a statement as the reason he rejected the privacy measure on Friday.
The text of Senate Bill 636 would have prevented governments from compelling nonprofits to disclose the private information of their donors.
The measure initially attracted widespread support, but Democrats’ support eroded as the party closed ranks on the issue despite a bipartisan list of advocates. Among the broad base of supporters, the American Civil Liberties Union argued that the measure protects Americans’ right to speech and association through donations.
The bill was presented in response to growing concern that people who donate to causes ranging from Planned Parenthood to the NRA would face backlash or be victims of “cancel culture” for their beliefs. Supporters said a public list of donors makes people targets for harassment, or worse, from an employer, church, landlord, teacher, or a political advocacy group targeting donors online.
Cooper sided with Democrats who have claimed the bill would shield political “dark money” from public disclosure, a claim that has worked its way into local news reporting.
Senator Natasha Marcus, D-Mecklenburg, tweeted that S.B. 636 would allow “politically active 501(c)(4) organizations to hide major donors.”
However, fact-checking of her claim by politifact.com found it to be “mostly false” with an in-depth analysis calling her claim misleading.
According to the bill language, S.B. 636 does not change the reporting requirements for political campaigns under campaign finance disclosure laws. Electioneering donations fall under separate rules to ensure a public record of candidates’ financial supporters. The bill states that the new rules would “not apply to disclosures required by State or federal law, criminal investigations, or orders of the court.”
Nonprofits are concerned that if they are forced to reveal their donors publicly it could have a chilling effect on financial support for charity across society.
“Donations of an individual’s time, talent, or money to a church, charitable recovery group for addicts, or a nonprofit for after-school tutoring are not ‘dark’— but they are often deeply personal and potentially put us at odds with what family members or friends believe is a worthy cause,” said Susan Vick, lobbyist for People United for Privacy. “This bill simply protects donor lists from being required for disclosure under the guise of state action as we’ve seen in other states.”
The U.S. Supreme Court recently ruled in favor of donor privacy in a case brought by Americans for Prosperity and the Thomas More Law Center against the California attorney general’s office. The case dates to when current Vice President Kamala Harris was California’s attorney general. She tried to force charitable organizations to file an unredacted “Schedule B” in their taxes, which would reveal the identities of any donor giving $5,000 or more to their nonprofit group.
AFP won an injunction against the California attorney general’s office in 2016, but the 9th U.S. Circuit Court of Appeals ruled that revealing donor identities did not violate the donors’ rights. The ruling forced the case to the U.S. Supreme Court, where 22 amicus briefs from liberal and conservative groups were filed to support the plaintiffs’ position.
Chief Justice John Roberts wrote the opinion with support from Justices Brett Kavanaugh, Amy Coney Barrett, Samuel Alito, Neil Gorsuch, and Clarence Thomas. Justices Sonia Sotomayor, Stephen Breyer, and Elena Kagan dissented.
“California casts a dragnet for sensitive donor information from tens of thousands of charities each year, even though that information will become relevant in only a small number of cases involving filed complaints,” the decision read.
“We have no trouble concluding here that the Attorney General’s disclosure requirement is overbroad,” the decision read. “The lack of tailoring to the State’s investigative goals is categorical — present in every case — as is the weakness of the State’s interest in administrative convenience. Every demand that might chill association, therefore, fails exacting scrutiny.”
The average private donation to charity is around $2,500, but most are less than $500. Those donations go to myriad organizations — from the arts to religious groups, volunteer medical providers, youth programs, and social movements. The impact of nonprofit organizations on North Carolina’s economy is close to $510 billion in revenue.