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The exemption loss lie
At several Oregon churches the last few Sundays, worshipers have been asked to sign a petition for a state constitutional ban on same-sex marriages.

"The campaign … has raised questions about how far churches can go to promote ballot measures without jeopardizing their tax-exempt status, which carries some limits on political activity," writes James Mayer of The Oregonian. Later in the story Mayer goes into more detail:

About 1,000 churches are involved in the petition drive, said Ray Cotton, pastor of New Hope Community Church in Clackamas and an organizer of the Defense of Marriage Coalition.

Cotton said tables are set up in the church foyer and people are encouraged to sign the petitions after the service. About 1,000 people signed May 30, he said, the first serious effort to get signatures. …

[Basic Rights Oregon communications director Rebekah] Kassell said her group is monitoring the political activity of the churches working to get the initiative on the ballot.

"Talking about the issue is one thing," she said. "Actively collecting signatures, launching a political organization and gathering funds to defeat or support a ballot measure, that's something else."

The risk for churches is the loss of their federal tax-exempt status as nonprofits. … Federal laws prohibit tax-exempt churches from supporting or opposing candidates for office. … The laws do allow some lobbying on legislative matters, which include ballot measure signature drives. Lobbying cannot exceed an "insubstantial" share of the church's overall activities. The law doesn't define the term. One court said churches can devote less than 5 percent of their activities to lobbying without jeopardizing their status, though another court said more than 20 percent would endanger it.

Thanks to Mayer for including those numbers, which are far too often left out of media reports that generalize about tax regulations on churches' political involvement. But tax law is a complicated thing, and the numbers aren't as cut and dried as they may first appear. For starters, a church doesn't only exist on Sunday mornings. Let's say the average congregation has three full-time staff (it may be more, but there are an awful lot of small churches out there). Does Oregon have many small congregations where the staff are spending six hours a week pushing for this amendment (and other legislation) as part of their jobs?

Ah, someone might say, but it's not only paid staffers; volunteers count, too. That's true, but do you think that after you count all of the hours that church volunteers spend each week—teaching Sunday school, leading Awana, practicing for the worship team, running the soup kitchen—you'll find that parishioners spent 20 hours out of every 100 for an entire year campaigning for this amendment and other legislation?

Setting up tables in the church foyer to attract referendum signatures clearly passes the 5 percent test, even if the effort is announced during services. (By the way, if someone can demonstrate that the gay marriage issue directly affects the operation of the church—not a big stretch, since most people marry in churches—then the church wouldn't even be held to the "insubstantial" rule.)

Suggesting that churches are jeopardizing their tax-exempt status by allowing such an activity is an antidemocratic scare tactic. A canard. A lie. (For more, here's the American Center for Law and Justice's helpful backgrounder and the IRS's own "Tax Guide for Churches and Religious Organizations.")

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June (Web-only) 2004, Vol. 48