Has the last special deal for labor unions in DISCLOSE Act been found?

June 24, 2010   •  By Sean Parnell
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Yesterday the House Committee on Rules approved the manager’s amendment to the DISCLOSE Act, as well as deigning to allow five amendments to be debated on the floor today. Early on the debate over the manager’s amendment focused over the special deal that was negotiated behind closed doors with the National Rifle Association, later expanded to exempt the Sierra Club from significant disclosure burdens as well.

More special deals appear to be coming to light today, including a potentially significant one for organized labor.  

One of the additions to the DISCLOSE Act has to deal with transfers between affiliated organizations, something that was not included in either the original DISCLOSE Act or the version that was passed out of the House Committee on Administration.

Dropped into the bill through the manager’s amendment is a section titled “SPECIAL RULE REGARDING TRANSFERS AMONG AFFILIATES.” In essence, the new language requires that it be disclosed when one entity covered by the DISCLOSE Act transfers $50,000 or more to another covered entity. Presumably, this is designed to reveal money being shuttled around the country by groups connected under some umbrella organization.

Affiliates are defined in the legislation as organizations where one entity is bound by the decisions of the other, where governing boards have designated seats for representatives of another organization or co-mingled boards, where one organization must approve board members for another, or where one organization charters another.  This definition is on page 11 of the manager’s amendment

So, one would think that this would cover unions that might transfer funds from, say, the New Jersey Education Association to the national organization, the National Education Association.

Ah, but no! If you go to pages 14-15 of the manager’s amendment, you find the following:

(E) DETERMINATION OF AMOUNT OF CERTAIN PAYMENTS AMONG AFFILIATES – For purposes of determining the amount of any donation, payment, or transfer under this subsection which is made by a covered organization to another covered organization which is an affiliate of the covered organization or each of which is an affiliate of the same organization… to the extent that the donation, payment, or transfer consists of funds attributable to dues, fees, or assessments which are paid by individual on a regular, periodic basis in accordance with a per-individual calculation which is made on a regular basis, the donation, payment, or transfer shall be attributed to the individuals paying the dues, fees, or assessments and shall not be attributed to the covered organization.

That certainly sounds to me like transfers between affiliated unions are exempted from disclosure, which typically receive dues paid by individuals that are paid on a regular, periodic basis, etcetera etcetera. While there may be a few other organizations that are structured in such a way, none come to mind.

Already exempt from the ban on speech by government contractors (unions receive government grants, not contracts), exempt from having to certify that they don’t have “too many” foreign members, and exempt from having to disclose their membership in most cases because their membership dues are generally below the disclosure threshold, it appears that unions have managed to get yet another special deal to exempt them from some of the onerous and intrusive burdens on their First Amendment rights.

Good for them, but too bad for other Americans, who don’t enjoy the same privileged status for their political speech that the First Amendment is supposed to guarantee.

Sean Parnell

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