By Jorge Casuso

July 7, 2025 -- The City Council is poised to take steps Tuesday that could suspend funding in the budget approved two weeks earlier for neighborhood groups whose tax status allows them to engage in political activity.

Under an agenda item sponsored by members of the Council's super-majority, the Council would hold a study session no later than September 30 to explore ways to reform the City's policy for granting “official” status to neighborhood groups.

The options include suspending distribution of grant funds to the five neighborhood organizations with a 501(c)(4) tax status that allows them to engage in politics using non-City funds "until a new policy framework is adopted."

The move would exempt the two 501(c)(3) organizations for FY2025-2027 "solely for open-invitation, community-building events" such as block parties, Make Music Day and Open Main Street, "subject to independent audit and compliance with nonpartisan activity restrictions."

The three sponsors of the item -- Councilmembers Dan Hall, Ellis Raskin and Caroline Torosis -- took the unusual step Thursday of issuing a press release announcing the move.

"This is about ethical government," Dan Hall said in the release. "We're seeking to reform official City recognition and add common-sense guardrails to prevent public funds from being used to quietly subsidize partisan political activity.

"We want to protect free speech while making sure City financial support is conditioned on responsibility and transparency with the public,” Hall said.

Tricia Crane, who heads Northeast Neighbors, which engages in local politics as a 501(c)4, denounced the move, noting the group has always disclosed its funding source and never used City money for political activity.

"Because we didn't endorse them, they put a target on our heads," said Crane, noting that Northeast Neighbors and Friends of Sunset Park backed candidates who opposed the Council majority.

"This is political payback pure and simple," Crane said. "They're using their power to take us down."

Last October, Northeast Neighbors also used non-City funds to warn residents about a State housing bill backed by the four victorious Council candidates that threatens to end single-family neighborhoods ("Homeowners Try to Get Out Urgent Message," October 18, 2024).

The Council's proposed action could lead to "a legal and administrative review of potential requirements prohibiting any neighborhood organization -- or its board -- from endorsing political candidates in their official capacity."

City staff would also explore "whether violations could or should result in the loss of official recognition and associated benefits," according to the item.

Tuesday's item comes two weeks after the Council voted 4 to 3 on June 24 to adopt a $793.3 million budget for FY 2025-26, which took effect on July 1, and $829.7 million for FY 2026-27.

Hall, Torosis and Councilmember Jesse Zwick opposed the budget because it restored $7,000 a year in funding for each of the city's seven neighborhood groups after Police Chief Ramon Batista offered some of the $73,000 allocated for officer training.

"I think it's incredibly inappropriate to be using taxpayer dollars to subsidize organizations that make political contributions and political endorsements,” Hall said. ("Tight Budget Zeros in on Public Safety," June 30, 2025).

In Thursday's press release, Raskin, who voted to continue funding the neighborhood groups in the budget, said the agenda item is "not about silencing civic engagement."

Instead, he said, it is "about developing community consensus" on the "role and structure of neighborhood associations," which "play a critical role in shaping civic life."

"I have heard from many community members who have asked us to reconsider the budget allocation to the Neighborhood Association Grant Program or to eliminate the program entirely," Raskin said.

If the City funding is pulled, Crane believes some neighborhood groups will find it difficult to pay for the non-partisan newsletters used to recruit and inform neighborhood residents.

"Most of the City money is used for mailers," Crane said, adding that Tuesday's agenda item "makes no mention of the mailers, so they would just disappear."