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North Carolina General Assembly passes bill limiting nonprofit donor disclosure

On August 25, 2021, the North Carolina Senate voted 25-19 to approve S636, a bill that would make donations to nonprofit corporations confidential. The bill now heads to Gov. Roy Cooper (D).

What the bill proposes

 S636 prohibits the public disclosure of names or identifying information of donors to nonprofit organizations. The bill language reads:“The identity of any person donating monies or other tangible goods to the nonprofit corporation shall not be disclosed by the nonprofit corporation if the person has notified the nonprofit corporation, in writing prior to or at the time of the donation, not to disclose the person’s identity.” It would also make nonprofit membership private: “Without consent of the board of directors, a membership list or any part thereof shall not be obtained or used by any person for any purpose unrelated to a member’s interest as a member.”    

The bill also says donor information cannot be considered a public record, and: “It is unlawful for any officer or employee of the State or an officer or employee of any of its political subdivisions to use or disclose in any way confidential information gained in the course of their official capacity.” Government employees who disclose such information would be charged with a Class 1 misdemeanor.

Reactions

The bill’s supporters say it will protect donors from harassment or discrimination based on the organizations they choose to support. People United for Privacy lobbyist Susan Vick said donations “are often deeply personal and potentially put us at odds with what family members or friends believe is a worthy cause. This bill simply protects donor lists from being required for disclosure under the guise of state action as we’ve seen in other states.” Some, like State Sen. Norm Sanderson (R), who sponsored the bill, pointed to a recent Supreme Court decision regarding a California policy that required nonprofits to disclose their donors’ identities to the state’s attorney general. Sanderson compared S636 to “having suspenders and a belt,” supporting the Supreme Court decision. 

Supporters also say that the bill does not change current campaign disclosure laws in North Carolina, and that investigators would still be able to get donor records with a subpoena. “It does not change any law that is currently in North Carolina,” Sanderson said. 

Opponents say the bill would decrease transparency around political campaign contributions and allow politically active nonprofits to hide their donors. Melissa Price Kromm, director of the North Carolina Voters for Clean Elections Coalition,  said the bill “protects wealthy special interest and dark money groups,” and state Sen. Natasha Marcus (D) said: “This bill would allow politically active 501(c)(4) organizations to hide major donors while using their money to support or oppose candidates and political issues.” 

In response to bill supporters who say it protects donors’ free speech and privacy, state Rep. Marcia Morey (D) said “We talked about free speech; We talked about free assembly. That’s not what we’re talking about here. We’re talking about money… money that has power to influence and oftentimes money that has power to corrupt.”

What comes next

Cooper has not indicated publicly whether he intends to sign S636 into law. If Cooper vetoes the bill, lawmakers must have a three-fifths majority vote in both chambers of the state legislature to override the veto. Neither party currently has a veto-proof majority in either chamber of the North Carolina General Assembly. 

Arkansas, Nebraska, Tennessee and Wyoming are considering similar legislation this session.

The big picture

Number of relevant bills by state: We’re currently tracking 39 pieces of legislation dealing with donor disclosure and privacy. On the map below, a darker shade of green indicates a greater number of relevant bills. Click here for a complete list of all the bills we’re tracking. 

Number of relevant bills by current legislative status: 

Number of relevant bills by partisan status of sponsor(s): 

Recent legislative actions

For complete information on all of the bills we are tracking, click here. 

• California SB686: This bill would require a limited liability company that qualifies as a committee or a sponsor of a committee under the state’s campaign finance laws to file a statement of members with the secretary of state. The statement of members must include a list of all persons who have a membership interest in the limited liability company of at least 10% or who made a cumulative capital contribution of at least $1,000 to the company after it qualified as a committee or sponsor of a committee, or within the 2 calendar years before it qualified.
  • Primary emphasis: Disclosure
  • Democratic sponsorship.
  • The bill passed the Assembly Appropriations Committee in a 12-4 vote on Aug. 26.  

• North Carolina S636: This bill would provide that, except as specifically required by state or federal law, the identity of any person giving money or other tangible goods to a nonprofit corporation or furthering any charitable purpose of that nonprofit corporation is confidential.
  • Primary emphasis: Privacy
  • Bipartisan sponsorship.
  • The bill was approved by the North Carolina Senate in a 25-19 vote on Aug. 25.

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