Welcome to the premier edition of the bi-weekly Charity and Security Network newsletter.

The Charity and Security Network was launched in November 2008 by charities, grantmakers and advocacy groups to eliminate counterproductive barriers counterterrorism measures create for legitimate charitable, development, human rights and conflict resolution work.

On Nov. 24, the two-month retrial against the Holy Land Foundation for Relief and Development (HLF) and five of its leaders ended with guilty verdicts on charges of supporting Hamas, which was designated as a terrorist organization in 1995. The convictions came even though the prosecution admitted that all funds went to local charities, called zakat committees, that are not on government watchlists. Attorneys for the defendants said they would appeal.

On Sept. 2, 2008 OMB Watch filed comments on the Department of Justice (DOJ) proposed amendments to 28 C.F.R. 23, which governs programs that receive funding under the Omnibus Crime Control and Safe Streets Act of 1968 (Safe Streets Act). We asked DOJ to reject the addition of "domestic and international terrorism, including material support thereof" to the list of activities that could be investigated. Our comments noted, "This is redundant, since terrorism and providing material support for it are crimes, and the current rule already covers criminal activity. A separate listing implies that non-criminal activity could be subject to investigation…This is not just a potential danger. The government has treated free speech activities as a terrorist threat, using anti-terrorism resources to investigate people and groups that publicly and vocally dissent from Bush administration policies." Unfortunately, DOJ incorporated the expanded powers into its new Guidelines, released in early October.

The full text of the comments are here

On Sunday, Sept. 28, 2008, 33 pastors engaged in partisan electioneering from the pulpit as part of Pulpit Freedom Sunday, an initiative launched by the Alliance Defense Fund (ADF), a conservative legal alliance. ADF wants to challenge the constitutionality of the ban on partisan electioneering by religious and charitable organizations exempt under Sec. 501(c)(3) of the tax code. Violation of this rule can result in loss of tax-exempt status. This ill-advised effort threatens the nonpartisan nature of the nonprofit sector. It would give religious organizations rights non-religious organizations do not have, create an indirect taxpayer subsidy for partisan sermons, and open new conduits for inserting soft money into election outcomes.

This summary is intended to share the information and generate discussion about significant issues that emerged in a Sept. 22, 2008 conference call between the Treasury Guidelines Working Group (TGWG) and officials of Treasury's Office of Terrorism and Financial Intelligence.

On July 17, the American Civil Liberties Union (ACLU) of Maryland disclosed documents revealing that state police engaged in covert surveillance of local peace and anti-death penalty groups for over a year during the administration of former Maryland Governor Robert L. Ehrlich (R). In response, House Majority Leader Steny Hoyer (D-MD) said he might support a Justice Department investigation into why this surveillance occurred. Rep. Bennie Thompson (D-MS), chair of the House Homeland Security Committee, wrote to Department of Homeland Security Secretary Michael Chertoff requesting a full account of the surveillance actions and further information regarding the funds used.

On July 16, the House Clerk and Secretary of the Senate released updated guidance that applies to any organization that registers as a lobbyist under the federal Lobbying Disclosure Act (LDA), as updated by the Honest Leadership and Open Government Act (HLOGA). House and Senate leaders directed the Secretary of the Senate and the Clerk of the House to rewrite the guidelines in response to complaints about the original guidance.

Two recent grassroots media campaigns promoting action on climate change learned that campaign finance rules can be a trap for unwary advocates, illustrating how federal election law has reached beyond partisan campaigning to treat traditional grassroots issue advocacy like electioneering. Both ads appeared to comply with the Internal Revenue Service (IRS) prohibition on intervention in elections.

In response to an Internal Revenue Service (IRS) request for input on its 2008-09 guidance priorities, OMB Watch submitted comments that stated the top IRS priority should be the creation of a bright-line definition of prohibited political intervention for charities and religious organizations exempt under Section 501(c)(3) of the Internal Revenue Code (IRC). The IRS is continuing its public education efforts to inform groups about the prohibition on partisan election activities and will soon release two field directives for IRS agents to guide them in enforcing the rules.