Image source: Erone Stuff for Unsplash+
Nonprofit organizations face challenges in the 2026 midterm elections in the United States as campaign finance has become a key issue. Opaque funding and new state-level donor privacy laws threaten both citizen participation and public trust in the electoral process.
Nonprofit organizations such as OpenSecrets and Transparency International US have publicly expressed concern about the impact of dark money on elections and new legislative pressures related to donor privacy. As the Brennan Center for Justice reported, dark money spending reached an all-time high of $1.9 billion in the 2024 election cycle, “undermining Americans’ accountability and trust in the political process.”
Meanwhile, Transparency International US argued that donor disclosure is essential to democratic integrity. As Justice Kennedy wrote in the 2010 Citizens United v. FEC decision, disclosure “ensures that voters are fully informed,” while the U.S. Supreme Court recognized that in exceptional circumstances privacy must be protected to prevent harassment.
These statements highlight the paradox that nonprofits face as they demand transparency in the political system while defending the confidentiality of their supporters.
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Dark money
Organizations specializing in democratic governance, such as the Brennan Center for Justice, point out that dark money spending has reached record levels in recent election cycles. The term “dark money” refers specifically to resources that flow into the political system through organizations that are not required to disclose the identities of their donors.
In practice, this means that large sums of money can influence campaigns and public decisions without citizens having access to information about who is funding these efforts. Billions of dollars are poured into campaigns without disclosing the source of these funds. This phenomenon undermines transparency and makes it difficult for voters to see who is really behind candidates and ballot measures.
“The Democratic community here recently rallied behind a pro-democracy bill called the Freedom to Vote Act, and the Freedom to Vote Act does a whole bunch of things to strengthen democracy, but it has a big chapter on campaign finance reform,” said Scott Greytak, deputy executive director of Transparency International US NPQ.
He explained that the central aim of the bill is to strengthen political equality in principle one person, one voice. To accomplish this, it seeks to amplify the voices of small donors through public financing programs—in which taxpayer dollars provide candidates with a base budget—and matching systems like those in New York City and Washington, D.C., that multiply small donations many times over.
These mechanisms, Greytak said, are intended to give citizens a fairer chance to run for office and counter the dominance of wealthy individuals who can self-finance their campaigns.
“If there is no full transparency or disclosure, citizens will be asked to participate in elections without receiving full information about the candidates.”
How nonprofits respond
Since then Citizens United vs. FEC The 2010 ruling fundamentally changed the landscape of campaign finance in the United States. The U.S. Supreme Court’s 5-4 decision found that restrictions on independent political spending by corporations and unions violated the First Amendment’s free speech protections.
By striking down limits set by the Bipartisan Campaign Reform Act, the court effectively allowed these entities to spend unlimited amounts on political advertising and advocacy as long as they did not coordinate directly with candidates. That ruling overturned previous precedents and paved the way for the rise of super PACs, which can raise and spend huge sums from wealthy donors and organizations.
The result is billions of dollars dark money– those funds whose sources are not disclosed – have flowed into elections, increasing the influence of a small number of powerful interest groups and raising concerns about transparency, accountability and the balance of democratic representation.
Growing public awareness could become a driving force for reform.
“One way non-profit organizations counter the influence of big money is through disclosure. That’s why we’re trying to pass transparency laws that would require these organizations to disclose – even in.” [an] “Display itself – who their major donors are, how much they have donated and, when they submit reports to the government on that spending, who all their major donors are,” Greytak said.
In conversation with NPQBrendan Glavin, director of insights at OpenSecrets, said the lack of transparency in campaign finance continues to undermine public trust in democratic processes. He explained: “If there is no full transparency or disclosure, citizens will be asked to vote in elections without having full information about the candidates – who supports them, where the funding comes from, what their supporters’ motivations are and what financial benefits they might gain from doing so.”
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Under such circumstances, voters are left with little basis for making informed decisions. The result, he warned, was a loss of trust.
When asked about the future of campaign finance regulation, Glavin admitted that significant changes were unlikely in the short term. Still, he expressed cautious optimism: “There is more understanding and more information. We may not know exactly who some of these donors are – this dark money – but people are increasingly recognizing its presence and understanding that it is a problem,” he said.
And according to Glavin, growing public awareness could become a driving force for reform. “The more awareness we have, the greater the pressure to make changes. I am optimistic that over time we will achieve greater transparency.”
Glavin also emphasized that campaign finance has historically followed cycles. Regulations are introduced, actors find ways around them, new rules are enacted and the cycle repeats.
Tension between transparency and privacy
At the same time, legislative pressure on nonprofit organizations is increasing. Bills that would require nonprofits to disclose the identities of their donors have been introduced in 38 states.
Such requirements could have a chilling effect: they could expose donors to harassment or political retaliation and thus discourage civic engagement.
A report from the People United for Privacy Foundation confirms that this wave of legislation extends nationwide. Among the most notable proposals are those in Arizona that promote an “original source disclosure” model to force disclosure of the primary source of funds, and those in Montana that aim to restrict political participation by corporations and nonprofits.
These initiatives are presented as attempts to ensure greater transparency, but organizations warn that they could hinder citizen participation. In contrast, states such as Nevada and North Carolina have decided to strengthen privacy protections for donors and enact laws that protect the identities of those who support civic causes.
This situation reflects an ongoing political and legal battle in which the tension between transparency and privacy has become one of the central issues of the 2026 midterm elections. Proponents of disclosure argue that accountability requires knowing who is funding political causes. Still, nonprofits warn that such requirements could have a chilling effect: They could expose donors to harassment or political retaliation and thereby discourage civic engagement.
Brian Miller, executive director of Nonprofit Vote, explained: NPQ that nonprofit organizations dedicated to monitoring election transparency and promoting citizen participation face unique challenges due to evolving legislation at the state level.
Miller emphasized that the vast majority of nonprofits involved in voter education and registration operate under the 501c3 designation, which strictly prohibits partisan activity, and cautioned against confusing these organizations with other types of nonprofits. “It’s really important that we separate out the vast majority of nonprofits and not lump them together with the types of nonprofits that many of these rules are aimed at,” he said.
According to him, recent legislation in states like Arizona targets 501c4 organizations, which are fundamentally different from 501c3. “As far as I know, all of these rules are aimed at 501c4 nonprofit organizations, and 501c4 organizations are something entirely different because they can support and oppose candidates for public office to a limited extent,” he said.
These groups may use part of their budget for political activities, although this may not be their primary purpose.
The measures in states like Arizona are primarily aimed at requiring disclosure of 501(c)(4) and PAC spending and donors. Such efforts reflect a legitimate public interest; Since campaign finance laws already require the publication of donations to candidates, parties and campaigns, this information is made publicly available precisely to ensure a certain level of transparency in the democratic process.
Amid growing political polarization and increasing digital spending on platforms with weaker transparency rules, nonprofits must face the dual challenge of innovating their surveillance methods while resisting pressures that could undermine their independence.
https://nonprofitquarterly.org/nonprofits-face-challenges-in-the-fight-against-dark-money/
