While just about any private money can be used on lobbying, federal funds generally cannot be used for lobbying, or for the procurement of more contracts or grants. Following are some specific examples of what money can and cannot be used for lobbying.

1. Private Foundations

Basic Requirements

• Private foundations CAN fund lobbying activities by 501(c)(3) organizations if funds are not earmarked for lobbying. Grant applications can mention lobbying activities. Source: IRS Reg. 53.4945-2

2. Federal Funding

Basic Requirements

• OMB Circular A-122 prohibits use of federal funds for lobbying or political activities (electioneering). It also prohibits inclusion of overhead costs associated with these activities.

• The "Byrd amendment," (31 U.S.C. 1352) prohibits recipients of federal grants, contracts, loans or awards from using any federal funds to lobby for a grant or renewal of a grant. Recipients of federal funds are required to file reports with the grantor agency certifying compliance with these provisions and disclosing the name of persons registered as lobbyists under the federal Lobbying Disclosure Act.

• OMB Circular 1-133 governs auditing and reporting procedures for federal grantees. Audits must take place at least every two years, and if the grant is for more than 0,000 an independent CPA must conduct an audit for compliance with the provisions of A-122.

• Impact on lobbying activities of 501(c)(4)s: The federal Lobbying Disclosure Act singles out 501(c)(4) organizations by barring them from receiving federal grants if they lobby. [Source: 2 U.S.C.1611]. However, a 501(c)(4) can establish a separate bank account with private funds to pay for lobbying activities. [Source: H. Rept. 104-339, Pt. 1 at 24].

• Hatch Act: Some non-profits that administer federal grants and/or assistance programs are subject to the provisions of the Hatch Act. Check your grant agreement for specifics.