This post was originally published on Forbes Feb 11th, 2015
Pretty much everybody is mad at Lois Lerner, but it may be time to ease up on the people who used to work for her issuing rulings on whether organizations should be tax exempt. I have a hunch that the budget cuts must have hurt them a lot in the technology area. Maybe that’s not it, but I have noted a kind of anti-tech trend in their rulings. Just a trace of paranoia too as they worry about open source software aiding our enemies.
You want to educate people on how government can employ technology to be more transparent and accountable. You sponsored a panel discussion at a library to discuss T. You also plan to reach out to other organizations and provide ideas. You state that, “The next step is to make it mandatory for all states and cities to post all of their expenses online.” You are non-partisan and you do not promote the interests of any political party. You stated, “We have no intentions of lobbying lawmakers.”
Your primary activity is advocating for the adoption of a particular doctrine or theory. The doctrine or theory is of a nature which can become effective only by the enactment of legislation. As such, you are defined in Section 1.501(c)(3)-1(c)(3)(iv) of the regulations as an ‘action’ organization.
You advocate for legislative bodies to change the rules on how they operate. Because those legislative bodies would have to undertake action to put that change in effect, that action meets the definition of legislation in section 1.501(c)(3)-1(c)(3)(ii) of the regulations. Because you urge the public to propose to legislative bodies to change the rules on how they operate, you are influencing legislation also defined in section 1.501(c)(3)-1(c)(3)(ii) of the regulations.
You established that your first goal is to relocate politicians back to their home districts. The goal you established can only be attained through legislative action.
Supporting or opposing specific legislation is not a requirement to be considered influencing legislation. In Christian Echoes National Ministry, the Court looked at the organization’s continual attempts to influence legislation by appeals to the public to react to issues to conclude the organization was furthering non-exempt purposes. The Court also noted the fact that specific legislation was not mentioned does not mean that their attempts to influence public opinion were not attempts to influence legislation.
….make the software available for free to the public to use, change, or distribute it as Free and Open Source Software. Your activities consist of promoting the activities of an association of programmers whom develop and maintain Player. You spend eighty percent of your time promoting Player , which includes identifying and supporting important work on multimedia software across community supported projects. Player records, converts, and streams multimedia files, and related files.
First, is code written to improve Player functionality for the hearing impaired. Second, is improvements to code for digitally archiving videos used by government archival agencies and nonprofit libraries. Third, by reverse engineering abandoned and obscure video formats and building support for them into the Player, you hope Player users would preserve archival footage and other media that might otherwise be lost forever. These components are written and owned by private persons. However, you have not provided any information as to how you support these purposes.
The development and distribution of software is not a public work even if published under open source or creative commons compatible licenses because software is not a facility ordinarily provided to the community at public expense. Section 1.501(c)(3)-1(d)(2) defines the term charitable to include “erecting or maintaining public buildings, monuments, or works.” This language slightly broadens the original formulation from four centuries ago. The Statute of Charitable Uses, 43 Eliz. I, c.4 (1601) recognized as charitable the ‘repair of bridges, ports, havens, causeways … and highways’. Quoted in Rev. Rul. 71-29. The regulation language also closely parallels the synthesis provided by Restatement 3rd Trusts § 28 which defines charitable to include government or municipal purposes such as the “construction or maintenance of public buildings, bridges, streets, highways or other public facilities…” The charitable purpose underlying public works is to provide the “community with facilities … ordinarily provided at public expense.”
First, software is not a facility. It is not a lake, park, or like any other public work described in Rev. Rul. Rul. 66-359, Rev. Rul. 70-186, or any of the many other tax and trust authorities we reviewed. Software is intangible, and by its very nature software is not fixed; its perpetual existence and access by the public relies upon private persons hosting the code on private servers, and anyone may alter the Player. Second, software is not “ordinarily provided at public expense.” It is not something ordinarily constructed by public bodies for use by members of the public. Third, a public work cannot be owned by private persons. The Player code is owned by private persons. Fourth, even if the Player were otherwise a public work, the benefits of the program flow to individuals who use it to watch movies and video for nonpublic purposes. Anyone can appropriate it or portions of its code for nonpublic uses, which you encourage. We described above how commercial companies use the Player to conduct their businesses. We have not found any authority that authorizes a member of the public to use a public work for nonpublic purposes. Finally, public works must serve a community. You point out that the open source licensing ensures the Player serves the world.
We have not found any authority for the proposition that the world is a community within the meaning of § 501(c)(3). We think that proposition untenable because it would include the governments of nations whom are our enemies. Aiding our enemies does not further an exempt purpose. (Emphasis added)