"Of all the dispositions and habits which lead to political prosperity, religion and morality are indispensable supports. In vain would that man claim the tribute of patriotism, who should labor to subvert these great pillars of human happiness, these firmest props of the duties of men and citizens. The mere politician, equally with the pious man, ought to respect and to cherish them."1
Espionage, political threats, and infiltration of private societies are activities more seemingly identified as plot elements in the latest Tom Clancy thriller or The Da Vinci Code2 than as unfortunate byproducts of an ambiguous tax code. Churches struggling to find a voice in modern public policy debates, however, claim that these are real tactics utilized by groups seeking to enforce extreme interpretations of the Internal Revenue Code's political speech restrictions against tax-exempt organizations.3 Some of these groups have gone to the extreme of planting spies within churches to immediately report to the 1RS whenever clergymen address policy issues and admonish churchgoers to take action on those issues.4
Those opposed to tax-exempt churches having a role in the political realm view such actions by religious leaders as clear violations of a church's tax-exempt status.5 At the opposite end of the spectrum are those who support the right of churches to speak out on political issues unfettered by intervention from the 1RS or any other organization.6 Thus, in the modern development of fair and just tax policy, two competing visions have emerged as polar extremes7 in the debate over the relationship between the tax-exempt status of churches and their political advocacy efforts.
Couched somewhere between these two extremes is § 501(c)(3) of the Internal Revenue Code, which places two restrictions on the political speech and activities of tax-exempt organizations.8 The first is a more limited restriction mandating that "no substantial part of [a 501(c)(3) organization's] activities" may consist of "carrying on propaganda, or otherwise attempting, to influence legislation."9 The second restriction mandates that 501(c)(3) organizations may "not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office."10 These two restrictions have caused great concern to parties on both sides of the issue-some arguing that the restrictions do not go far enough to separate churches from the political arena and others arguing that these restrictions are an unconstitutional burden on religion.
The bulk of modern attention in this area has centered on the political campaign ban while giving only lip service to the restriction against "substantial" attempts to influence legislation. This one-sided focus of commentators11 and legislators12 likely stems from not only the increased political activity of churches during recent presidential elections13 but also the relative harshness of the political campaign ban versus the lobbying restrictions.14 Further, many view the constitutionality of the lobbying restrictions against 501(c)(3) organizations as settled law after the Supreme Court's decision in Regan v. Taxation with Representation of Washington.1* However, to this day, the 1RS has never revoked the tax-exempt status of a church solely for having a substantial amount of its activities dedicated to influencing legislation.16 Nonetheless, groups opposed to the political activity by churches continue to threaten religious entities with revocation of tax-exempt status for speaking out on social policy issues and urging members to take action in support of church positions.17
The lack of aggressive enforcement by the 1RS and continued threats against churches demonstrate that a number of lingering questions still cloud the definition of permissible church conduct in attempting to shape public policy: (1) How much of a church's activities, labor, and funds can it devote to influencing legislation and still retain its tax-exempt status? …