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119-hr-7799119th Congress

SPONSOR Act

Sponsored By: Representative Moran, Nathaniel [R-TX-1]

Introduced

Summary

Makes 501(c)(3) fiscal sponsors criminally and civilly liable for certain violent, terrorist, or commerce-blocking acts tied to projects they fund. It would define fiscal sponsorship, create a presumption that sponsors must ensure funds are used lawfully, and preserve defenses based on due diligence and reasonable oversight.

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  • Fiscal sponsors (501(c)(3) organizations): Would face civil suits and criminal charges if a sponsored project engages in a "covered activity," including aiding designated foreign terrorist organizations, using force or credible threats to intimidate people exercising constitutional rights, or physically blocking movement of goods in commerce. Sponsors must show they exercised reasonable oversight to avoid liability.
  • Sponsored projects and non-exempt groups: Projects that are not tax-exempt but operate under a fiscal sponsorship could trigger legal exposure for their sponsoring charity if those projects commit covered acts.
  • Donors: If a donor claims a tax deduction under section 170 or the sponsor represents a gift is deductible, that connection is a statutory trigger for sponsor liability.
  • Legal system and enforcement: The change creates new specific bases for civil and criminal liability tied to the fiscal sponsorship relationship, shifting legal risk onto sponsoring charities.

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Bill Overview

Analyzed Economic Effects

1 provisions identified: 0 benefits, 1 costs, 0 mixed.

New liability for nonprofit fiscal sponsors

If enacted, this bill would make a 501(c)(3) nonprofit that acts as a fiscal sponsor legally liable for certain harms. This would apply when the sponsor spends money for a fiscal sponsorship and a donor can claim a section 170 tax deduction for the gift, or when the sponsor tells a donor the gift is tax-deductible. Covered harms would include: knowingly helping or conspiring in a violent act by a foreign terrorist organization designated under law; using force, a credible threat of force, or physical obstruction to injure, intimidate, or interfere with someone exercising a constitutional right; and using force, threats, or physical blocking to stop lawful movement of goods in commerce. The bill would define fiscal sponsorship as a 501(c)(3) receiving and controlling funds for a non-exempt project and keeping discretion over how those funds are used. The bill would create a presumption that the sponsor must ensure funds are used lawfully, while still allowing defenses based on due diligence and reasonable oversight. "Intimidate" would mean placing someone in reasonable fear of bodily harm.

Sponsors & CoSponsors

Sponsor

Moran, Nathaniel [R-TX-1]

TX • R

Cosponsors

There are no cosponsors for this bill.

Roll Call Votes

No roll call votes available for this bill.

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