Courtney Read Hoffman, Owner, CRH Capitol Communications and Jason Sabo, Founder, Frontera Strategies

1. Texas Nonprofit Summit
Jason Sabo
Frontera Strategy
Courtney Hoffman
CRH Capitol Communications

2. Tweet it up!
@texassabo
@crhtexas
#txlege

3. Overview of Presentation
• What’s the Context for Nonprofits?
• Basic Federal Do’s and Don’ts
• The Texas Way: The Lege and the Lobby
• 5 Simple Steps to Get Stuff Done
• Discussion

4. Where is power in 2012?
• By the Numbers…
• Texas House in 2011 was 102 R and 48 D.
• Texas Senate in 2011 was 19 R and 12 D.
• 2013 may have slight change in numbers but big shift to the right in both
chambers thanks to redistricting and primary process.
• Chairmen of key committees of the Texas Senate and House have retired
or were defeated in advance of the 2013 Texas Legislature.
• Primary results will push legislators to the right to insulate against
“being primaried” by a Tea Party Republican.
• By the Map…
• New legislative districts further consolidate power in fast-growth
suburban counties.
• Rural and West Texas communities continue to see rapid erosion of
people and of political power.
• Border communities grow in population and clout.

6. Where is power in 2012?
• By the Agency…
• Texas executive branch long considered weak. Reality couldn’t be
farther from the truth – especially now.
• Impressive consolidation of state agency direction and control under
Texas Governor Rick Perry. Longest serving Governor in Texas
history and no limit on the number of terms served.
• New leadership at state’s largest agencies: education and health.
• By the Tweet…
• Capitol press corps(e) continues to dwindle, creating new
opportunities for ordinary citizens and activists to set the tone and
frame of most important public policy debates.
• Social media outlets quickly outpacing traditional media in terms of
importance and response time. Keep an eye on #txlege.

7. Texas State Budget in 2011
• The Bonnie and Clyde Effect and Texas Children
• Historic Budget Cuts to Children’s Programs
• Education
• $4 billion from Foundation School Program
• $1.3 billion from Discretionary Grants
• Health and Human Services
• Big direct cuts to prevention programs and services
• Cuts to providers (not kids) with access impact
• LOCAL Taxpayers Will Pick Up the Difference
• Not an Aberration or One Time Event – Reality
for the Foreseeable Future

8. Texas State Budget in 2011
What the #$%@ happened?!?
• The Great Recession and Revenue Slowdown
• Structural Deficit of $10 Billion
• Loss of Federal Stimulus Funds
• Lack of Political Willingness to Utilize the Rainy
Day Fund or Increase Revenues (Sort of.)
• Hangover from deferrals by past legislatures.

9. 2013 and Nonprofits
• The Ghosts of Legislatures Past…
• 2006 Structural Deficit of up to $10 billion will return.
• February 2012 Projected Medicaid Shortfall of “up to $17 billion”
• Massive deferrals of Medicaid and Public Education Costs from the
2011 Texas Legislature
• Tighter city, county, and school budgets combined with
growing pressures on Texas state budget (Energy, Water,
and Transportation)
• Health Care Reform and Health Care Exchanges –
Federal Exchange Default and its Implications for Texas
 Public School Finance: The Most Important Subject that
Nobody Wants to Talk About (Yet)
 BUT… The budget picture is looking less bleak. Restore?

10. You’re either at the
table or you’re on
the menu.

11. Why are nonprofits always
the cheap appetizers?
 We censor ourselves before we even speak.
 We do not understand the basics of the law and
allow others to scare us into inaction.
 We never ask supporters to fund advocacy and are
timid about asking them to push pro-nonprofit
policies.
 Because all politicians love nonprofits and don’t
need to be pressured to do the right thing…
RIGHT?!?
 Because we always have been…

12. Is lobbying by nonprofits legal!?!?
YES! Completely,
absolutely, totally…
Lobbying by 501(c )(3) nonprofits is
100% legal.

13. Take the H Election and know your limits.
• A generous amount:
• 20 percent of the first $500,000 of annual
expenditures;
• 15 percent of the next $500,000;
• 10 percent of the next $500,000;
• 5 percent for every additional $500,000 up
to $1 million.
• ABC nonprofit with expenditures of
$500,000.
• 20% of $500,000 = $100,000 = Overall
lobbying limit.

14. Substantial Part: Expenditure Test:
• No certain and definitely • Clear and specific
allowable amounts of definitions of lobbying
lobbying expenditures • Certain and definitely
allowable amount of
• A single year violation lobbying expenditures
may result in the loss of • No jeopardy to tax-
tax-exempt status exempt status for a single
year violation
• Importance of an issue is • Importance of an issue is
a relevant factor in not a factor in measuring
determining permissible permissible lobbying
lobbying activity activities
• Possible additional • Possibly less reporting
burden than substantial
reporting burden on tax part test
form 990

15. State and Local nonprofits CAN:
• Write and encourage people to write letters
concerning specific legislation.
• Meet with and speak to public officials about
legislation.
• Testify at a public hearing.
• Provide research, analysis and commentary
• Publicly endorse or oppose specific
legislation.
• Invite a legislator to visit

16. What activities are NOT lobbying?
• Self-Defense (Matters affecting a nonprofit’s own
tax status, powers or advocacy rights.)
• Contacts with elected officials or executive branch
about proposed regulations.
• Lobbying by volunteers (AKA Cruise Missiles)
• Communication with the organization’s members
on legislation with no call to action.
• Participation in a legislative hearing at the
invitation of a committee or member.

17. Nonprofits CANNOT:
• Raise funds for candidates as an organization.
• Publicly support or oppose a candidate.
• Conduct PARTISAN voter registration.
BUT – remember – after work you are a citizen and have
the
full rights and obligations of anyone in our democracy.
Just be
mindful of your actions and don’t be stupid...

18. But know the Texas Lobby Law
• Pertains only to lobbying at the state level.
• Applies to both for-profit and non-profit.
• Administered by the Texas Ethics
Commission www.ethics.state.tx.us
• Includes triggers for lobby registration,
reporting requirements, prohibitions, civil
and criminal sanctions.

19. Texas Lobby Registration?
• If a person or entity communicates directly
with a state legislator, staff or executive
agency personnel and
• That person is compensated or reimbursed
more than $1,000 a quarter and more than
5% of that person’s time is engaged in lobby
activity or
• Anyone lobbying spends more than $500 in
a quarter on state legislators, staff and/or
agency personnel
 Then Lobby Registration is required.

20. So…what does that mean for
Texas non-profits?
• Focus on grassroots lobbying - involve your
board and volunteers in lobbying rather
than paid staff.
• Make volunteers aware of the spending
threshold for lobby registration.
• Educate about prohibitions-offering food,
drink, transportation, entertainment and
gifts-they apply to all, not just registered
lobbyists
• Register if you cross either the
compensation or expenditure threshold.
• Non-profit lobby registration is discounted -
$150 a year.

21. The Texas Legislative Cycle
• Legislative Session – 140 days, odd-
numbered years
• Interim – Time between Sessions
• Legislative Strategy is a biennial (two-year)
cycle
• Plan for the legislative, budget and
regulatory processes
• Monitor campaign and political activity

22. How to Win:
The Cardinal Rules of Lobbying
1. Focus on 1 or 2 issues.
2. Be accurate and have meaningful
data at your fingertips.
3. Be timely. Keep it simple.
4. Be honest and be credible.
5. Follow up during implementation.

23. Focus Focus Focus
 Deciding where to focus is the hardest part of
your advocacy. You MUST prioritize.
 If you try to be everything to everyone, you will
get nothing done and NOT protect your
appropriations.
 For the time being, THINK FREE BILLS!
 Cardinal Rule of Lobbying: Pick your top
one or two FREE priorities and stick with them
to the end.
 In Practice: High School Financial Literacy

24. Have meaningful data.
 Data and statistics are increasingly important.
 You MUST have the ability to show the
effectiveness, efficiency and return on
investment of everything you do.
 The more unusual the voice, the better.
 Cardinal Rule of Lobbying: Messengers
matter. Numbers might be the same but the
impact can be very different.
 In Practice: George H.W. Bush School Radicals

25. Keep it simple.
 Speed is important. If you don’t provide answers to
legislators and staff quickly, they will ask someone
else for the same info.
 We know more about our issues than anyone else and
we LOVE to let the world know how smart we are. If
you can’t explain your issue in one page, you need to
reassess your approach.
 Cardinal Rule of Lobbying: Always respond
quickly and in easy to understand language to
requests for information, but don’t stretch the truth in
order to be fast.
 In Practice: “Jason, SHUT UP! You’re going to kill
my bill!”

26. Be very credible.
 Never, never, never stretch the truth.
 If you don’t know the answer to any
question, it’s OK to say “I don’t know.”
 Create the Excuse to Return
 Cardinal Rule of Lobbying: If you are
going to oppose or contradict legislators’
bills or proposals, tell them beforehand.
 In Practice: Today’s child care quality enemy is
tomorrow’s juvenile justice BFF.

27. Follow Up after You Win
 Passing the bill is only the first step, actually making
it do something is much harder.
 Most advocates stop their work on the last day of the
legislature.
 Regardless of what your legislation does, cash-
strapped agencies will have little time or personnel
to implement your glorious idea.
 Cardinal Rule of Lobbying: Don’t assume your
work is ever done. It isn’t.
 In Practice: Meningitis legislation
implementation.

28. Lobby the media.
 Regardless of what they ask, FOCUS and
repeat, repeat, repeat your message.
 The first person to call back gets in the story.
The first person to be coherent gets quoted.
 Nothing is worse than being called out as
dishonest in the press.
 Journalists ARE social media. If they think
your issue is a story, others will too.
 Lobby the media like you do the legislature.

29. Use the Internets.
 Twitter is more than a service for telling people you
cut your toenails.
 Social media allow advocates to create their own
news – instead of waiting for traditional media to
decide we have a story to tell.
 Social media also allow advocates direct access to
legislators, staff, and other advocates. And vice
versa, so be smart.

30. What did he/she just say?
Jason Sabo
Voice and Text: 512.450.2125
fronterastrategy@gmail.com
www.facebook.com/jasonsabo
@texassabo
Courtney Hoffman
Voice and Text: 512.751.2269
choffman@crhtexas.com
@crhtexas