Should San Jose require nonprofits to register as lobbyists?
San Jose City Hall is located at 200 E. Santa Clara St. Photo by Jana Kadah.

    Like corporate lobbyists, nonprofit leaders meet regularly with San Jose officials to influence policy decisions. But nonprofits, which are often awarded millions in city contracts, don’t have to disclose their meetings like other lobbyists.

    San Jose prides itself on its “sunshine” laws, a series of policies adopted in 2008 that require lobbyists to register, pay a fee and publicly disclose who they’re meeting with and what was discussed. But the rules don’t apply to one of the most influential groups at City Hall—nonprofits.

    Ethicists say more transparency is needed, while nonprofit leaders worry changing the rules will make it harder for them to advocate for policies and discourage smaller nonprofits from working with the city.

    “Many community-based organizations compete for millions in funding from the city to provide an array of services, in the same way that private companies bid on contracts,” said Adrian Gonzales, who previously chaired the city’s ethics commission. “The (city) should at least study this issue to determine if there’s any correlation between nonprofits who regularly meet with policymakers and resulting contract awards, amendments or other policies that benefit those organizations.”

    But Kyra Kazantzis, president of the Silicon Valley Council of Nonprofits, said it would be “detrimental” to compare nonprofits to corporations and the lobbyists who work for them.

    “It’s in the name: we are not-for-profit organizations. Our goal isn’t to make more money,” Kazantzis told San José Spotlight. “Our job is to serve the community.”

    It’s not uncommon for nonprofit leaders to have the ear of Silicon Valley politicians, who vote to award them contracts for city services and projects.

    For example, San Jose Mayor Matt Mahan met with Destination: Home’s CEO Jennifer Loving three times over the last two months. Destination: Home has numerous contracts with the city totaling more than $13 million to provide services for homeless youth and families.

    Mahan and councilmembers met with several other nonprofit leaders that also receive millions from the city like Aubrey Merriman, the CEO of LifeMoves, and officials from MidPen Housing.

    Nonprofits exempt

    The last time San Jose tightened its lobbying laws was in 2015. Now, lobbyists must file online weekly reports to reveal whether an interaction with an elected official happened in-person, by phone or email. Gonzales said it’s a much stricter policy than required by the state. Still, many lobbyists skirt the existing rules by not divulging what was discussed.

    At the time, former Councilmembers Johnny Khamis and Pierluigi Oliverio pushed to include nonprofits in the lobbying policy but it didn’t happen because of a lack of political will.

    Oliverio called out Carl Guardino, the former CEO of the Silicon Valley Leadership Group, to register as a lobbyist because of his power and influence. Guardino, a close friend of former San Jose Mayor Sam Liccardo, in 2020 helped write a policy that exempted his energy company from a landmark natural gas ban.

    “We have to ask, is the group or individual trying to ascertain either significant funds or policy changes that benefit them?” Oliverio told San José Spotlight. “If so, regardless of a political slant or type of organization, it’s fair to consider them as a lobbyist.”

    Oliverio said having nonprofits report their meetings with city officials and politicians wouldn’t make it harder to approve a contract or do city business.

    “It just provides awareness and transparency that these individuals or organizations are seeking public funds,” Oliverio said.

    Kazantzis said this could hinder smaller nonprofits from advocacy work because of an intimidating reporting process and the risk of making mistakes. She said the idea to liken nonprofit leaders to lobbyists is a political attempt to silence nonprofit advocacy.

    “I’ve seen the suggestion that nonprofits who advocate for their communities register as lobbyists come up again and again over the years, and literally every time it’s because some elected official has a bad policy idea,” Kazantzis said. “And when I say bad policy idea, I mean one that takes away what little resources and power low-income communities and people of color have.”

    Under state lobbying laws, 501(c)(3) nonprofits are exempt from registering as lobbyists. If San Jose expanded its lobbying laws, it would likely be the first Bay Area city to do so, Gonzales said.

    It’s not the only thing nonprofits are exempt from in San Jose. Nonprofits are also exempt from the city’s revolving door policy which prohibits former city employees from working at an organization that does business with the city for two years. A city commission considered including nonprofits in the policy in 2018, but the recommendations died before coming to the San Jose City Council. The commission weighed the idea again last month and it could come to the council this year.

    “I think nonprofit leaders have made relationships with certain council majorities and are able to say, ‘Hey, don’t count us (like the others),’ and councilmembers agreed,” Oliverio said. “(Right now) there isn’t political will to change this.”

    Contact Jana Kadah at [email protected] or follow @Jana_Kadah on Twitter.

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