Nonprofits in Delaware with the federal tax exemption for charities would face campaign limits

Nonprofits with the federal 501(c)(3) tax exemption for charities operating in Delaware would be barred from endorsing, opposing, or contributing to candidates, parties, or election campaigns. The ban would cover federal, state, and local elections. They could not use charitable funds, grants, or donations for partisan politics or let staff, facilities, or communications support or oppose candidates.

The state would revoke a violating nonprofit’s eligibility for state grants or contracts for up to five years. These consequences would apply to nonprofits with the federal 501(c)(3) tax exemption for charities that operate in Delaware and are found to violate the campaign rules. The Department of Justice would set a fine. The nonprofit would have to correct the violation, including repaying any misused money.

The Department of Justice would oversee compliance and investigate suspected violations in coordination with the Secretary of State. The state auditor would periodically review nonprofit grant recipients. The rules apply to nonprofits with the federal 501(c)(3) tax exemption for charities that operate in Delaware.