Nonprofit Policy News | March 2009
Contents
SPOTLIGHT: Senator Baucus Introduces the Nonprofit Capacity Building Act of 2009 | Serve America Act Moves Rapidly from the House to a Senate Floor Vote Next Week | SPECIAL REPORT: Foward Together Declaration | Federal Legislative and Regulatory Developments | OMB Watch Survey: Nonpartisan Electoral Activity! | NVEN: 2008 Voter Turnout | New GAO Report Released on Federal Funds and the Nonprofit Sector | Sidebar Webinars | State Policy Developments | About Nonprofit Policy News
SPOTLIGHT: Senator Baucus Introduces the Nonprofit Capacity Building Act of 2009
On March 17, the National Council's efforts over the last five years to strengthen small and midsize nonprofits cleared another hurdle when Senate Finance Committee Chair Max Baucus (MT-D) introduced the Nonprofit Capacity Building Act of 2009 (S 609). The bill would create an innovative $25 million fund in the budget of the Corporation for National and Community Service to make matching grants to intermediary nonprofit training and technical assistance entities. Those intermediaries will then provide organizational development assistance (training and technical assistance for capacity building) to small and midsize nonprofits, especially those in areas where nonprofits face "significant resource hardship challenges." Nonprofit intermediaries would need to secure a non-federal 50% match to be eligible for a grant. Tim Delaney, National Council President & CEO, stated: "Now more than ever, we need to strengthen nonprofits in meeting community needs. We appreciate the leadership provided by Senator Baucus and our Public Policy Chair, Brian Magee, Executive Director of the Montana Nonprofit Association, in taking us this far. Now is the time for other Senators to co-sponsor this legislation and pass it as soon as possible, perhaps even as part of the Serve America Act, to strengthen nonprofits' ability to handle increased volunteerism. This infrastructure piece is critical to the success of scaled up volunteer efforts."
It was just last month that nonprofit leaders finalized the Forward Together Declaration (see below) which set as part of its long term agenda the improvement of government-nonprofit partnerships and the launching of a nonprofit capacity building initiative. Passing NCBA would be a major step forward together. Look for our Action Alert shortly!
Serve America Act Moves Rapidly from the House to a Senate Floor Vote Next Week
National service legislation is moving rapidly through Congress, following the President's request for a bill to pass quickly. The House voted March 18 to approve on a bipartisan basis the largest expansion of government-sponsored service programs since President Kennedy's call to service in 1963. The legislation - the GIVE Act or Generations Invigorating Volunteerism and Education Act (HR 1388) - passed by an overwhelming bipartisan vote of 321 to 105. House Education and Labor Committee Chair, Representative Miller (CA-D) stated, "This legislation will make Americans a part of the solution to getting our country back on track...Service is the lifeblood of this country." You can view his remarks and those of other Representatives who helped move this legislation on YouTube.
The Senate Health, Education, Labor and Pensions (HELP) Committee also approved the Senate's companion version, the Serve America Act (S 277), on the same day in a brief session where Senator Mikulsik (MD-D), managing the bill for Senator Kennedy (MA-D), substituted the House bill as S 277. It is anticipated that the Senate will consider the bill early next week.
The legislation would more than triple the number of service positions by growing AmeriCorps volunteers from 75,000 to 250,000, and creating volunteer programs focused on education, health care, clean energy and veterans. Also included are a Volunteer Generation Fund to help organizations recruit and manage volunteers; a Social Innovation Fund to increase private and public investment in nonprofit community organizations that are effectively addressing national and local challenges to allow such organizations to replicate and expand successful initiatives; expansion of the National Civilian Conservation Corps; new targeted VISTA grant programs; and designation of September 11th as a National Day Of Service And Remembrance. Specific new infrastructure for volunteers - from teens to baby boomers - include two new Learn and Serve programs aimed at students, fellowships for older Americans, and increases in stipends for VISTA, AmeriCorps and NCCC volunteers. Those who complete a term of national service and annual training will form a National Service Reserve Corps to respond to national disasters and other emergencies. To learn more about the key provisions of both bills, read the congressional press release. New York Times, 3/19/09, CQ Today Online News, 3/18/09, 3/11/09
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Join Us in the "Forward Together" Declaration Recognizing the need for the nonprofit sector to speak out in a unified voice in this time of great need, some concerned Americans crafted a special declaration - the Froward Together Declaration - that emphasizes interdependence and our need for uniting. Styled as an action document, the Declaration offers concrete ways nonprofits can help reinvigorate the partnership between the government and nonprofit sectors to address our country's economic challenges and improve the quality of community life. The Declaration also serves as an awakening document, encouraging individuals in nonprofits to declare to ourselves, the general public, and our natural partners in local, state, and federal governments that the nonprofit sector adds value, contributes enormously, and won't be taken for granted anymore. This document presents a significant opportunity for our sector to step foward collectively to reclaim our proper space as the recognized third vital leg of the stool.
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Sign the Declaration Today by going to the website created by the Johns Hopkins Listening Post Project (which orgainized the retreat where the Declaration was conceived.) By signing, you add your name to the list as an individual; organizatonal names are listed for identification purposes only. Spread the word. Please encourage others - your friends, office colleagues, board members, volunteers, and others who care about the nonprofit sector - to sign as well, by spreading news about the Declaration. |
Federal Legislative and Regulatory Developments
In this section: 2009 Omnibus Appropriation Passed and Signed| FY 2010 Proposed Federal Budget with Proposed New Limit on Tax Deductions - Including Charitable Deductions - Generates Controversy | IRA Rollover Legislation Re-Introduced| Obama Turns Back Clock on Some Bush Midnight Rules | IRS Updates
2009 Omnibus Appropriations Passed and Signed
On March 11, President Obama signed the $410 billion FY 2009 omnibus bill (HR 1105) thus ending a protracted period of debate regarding funding for the federal fiscal year that began October 1, 2008. The legislation, comprised of the nine appropriations bills not passed last fall, will increase funding over FY 2008 levels by $31 billion, or roughly eight percent. Appropriations increased for the Community Services Block Grants; Child Care and Development Block Grants; community service jobs for seniors; food programs; and the women, infants and children (WIC) program. Funding decreased for the Compassion Capital Fund. The bill contained no tax increases or major policy initiatives. CQ Today Print Edition, 3/10/09
FY 2010 Proposed Federal Budget with Proposed New Limit on Tax Deductions - Including Charitable Deductions - Generates Controversy
On February 26 President Obama released his proposed budget for FY 2010, that included two interrelated proposals of great interest to nonprofits. The first is the President's proposal to create a $634 billion reserve fund to underwrite the initial major step towards reforming our nation's health care system, an issue that many people perceive as the greatest threat to our country's fiscal sustainability. The second item is the proposed mechanism for paying for the bulk of that reform ($318 billion worth): the President's proposal to reduce the amount that "high income" people (the 1.2% of Americans with income greater than $250,000 a year) can deduct from their taxes from 33% or 35% (depending on their tax bracket) to the 28% that other itemizers can claim - including deductions for charitable contributions.
The latter has generated considerable concern and comments - both Senators Baucus (MT-D) and Grassley (IA-R), Chair and Ranking Member of the Senate Finance Committee, have expressed skepticism. The Center for Budget & Policy Priorities noted in a report that the proposal would affect only the top 1.2 percent of U.S. taxpayers while leaving the other 98.8 percent unaffected, with a projected decline in charitable giving by only 1.3 percent. Many charities have questioned the timing of the proposal, especially with more organizations sliding closer to bankruptcy due to declines in donations.
Even if Congress agreed with the reduction, it would not apply to anyone until - at the earliest - January 2011. For more information, analysis and commentary, read our Special Report. CQ Today Online News 3/4/09, 3/3/09
IRA Rollover Legislation Re-Introduced
Representatives Pomeroy (ND-D) and Herger (CA-R) introduced the Public Good IRA Rollover Act of 2009 (HR 1250) which would permit - on a permanent basis - tax-free distributions from individual retirement accounts (IRA) for charitable purposes and remove the current dollar limit on donations per year. As a result, IRA owners would have a flexible, planned giving option starting at age 59½.
Obama Turns Back Clock on Some Bush Midnight Rules
The Obama Administration is taking action to reverse controversial regulations finalized in the closing days of the Bush Administration, including one affecting endangered species and another limiting access to reproductive health services. To learn more, visit the OMB Watch website.
How Nonprofits Can Claim Credit for COBRA Premiums for Former Employees.
The IRS has released new information to help employers claim credit for the COBRA medical premiums they pay for their former employees. The American Recovery and Reinvestment Act of 2009 - the economic stimulus package passed last month - establishes an employer-provided subsidy for employees who involuntarily lose their jobs: the COBRA Health Insurance Continuation Premium Subsidy. More specifically, certain individuals who are eligible for COBRA continuation health coverage, or similar coverage under state law, may receive a subsidy for 65 percent of the premium - they pay only 35 percent of the premium. The employer may recover the subsidy provided to assistance-eligible individuals by taking the subsidy amount as a credit on its quarterly employment tax return. The IRS issued a news release outlining information for employers. In addition to the website information, the IRS is also sending Form 941, Employer's Quarterly Federal Tax Return, to about 2 million employers in mid-March. The form is used to claim the new COBRA premium assistance payments credit, beginning with the first quarter of 2009.
Take the OMB Watch Survey About Nonpartisan Electoral Activity! Open Until March 23rd.
OMB Watch has invited 501(c)(3) nonprofit organizations to participate in a brief survey that will collect information on the fairness and appropriateness of the Internal Revenue Service's (IRS) Political Activities Compliance Initiative (PACI). Section 501(c)(3) charities cannot campaign for or against candidates for public office. However, they can engage in nonpartisan voter registration, education, and mobilization, as protected by the First Amendment. Through PACI, the IRS investigates allegations of prohibited election intervention by 501(c)(3) organizations.
Learn what really happened with voter turnout in the 2008 election.
Nonprofits made an unprecedented contribution to voter education and mobilization last year and played a vital role in boosting voter turnout in the presidential election to levels unseen since the early 1960s. The Nonprofit Voter Engagement Network (NVEN) website provides data from the US Elections Project, the Census and others to provide the best snapshot of turnout in the 2008 presidential election currently available. Their report voter turn out in the 2008 Election, America Goes to the Polls: A Report on Voter Turnout, provides information on voter turnout in the states, the gains made since 2004, the effect of campaign spending and our winner-take-all elections on turnout, the importance of Election Day Registration to turnout, information on voting trends among young voters, blacks and Latinos and an overview of the election reform issues that will take center stage in 2009.
New GAO Report Released on Federal Funds and the Nonprofit Sector
You can read the full report - "Significant Federal Funds Reach the Sector through Various Mechanisms, but More Complete and Reliable Funding Data Are Needed" - or a summary on the OMB Watch website.
Join the national kick-off FREE webinar for "Nonprofits Count! 2010 campaign" presented by the Nonprofit Voter Engagement Network, Wednesday, April 1, 2 PM ET / 11 AM PT. Who the Census counts impacts ten years of $300 billion in federal funding, as well as political representation, locations of schools, transit, health care centers and more. Nonprofits reach millions of Americans daily. We can make an important difference in a complete count for our communities. Find out what's at stake for nonprofits and our communities, who is in danger of being undercounted, and what nonprofits can do to help ensure an accurate and complete count.
To register, visit www.nonprofitscount.org. Participants receive copies of our new Census 2010 fact sheets...plus we will send you a free copy of America Goes to the Polls, NVEN's newest report on turnout and factors in the 2008 presidential election.
In this section: Tax Credits and Exemptions | Institutional Structure and Management | Advocacy and Lobbying | Fundraising and Solicitations | Miscellaneous
State legislators regularly introduce dozens of bills that impact all nonprofits in their respective states. Below is a recent sampling of such bills, listed first by category, then alphabetically by state. Note that the National Council does not do comprehensive tracking of state legislative or regulatory changes. For more detailed information on public policy issues at the state level you can find your State Association's policy section here. Unless otherwise noted, the bills below have not become law.
FL | Auctioning Tax Credits
S2668/H1223 would create a tax credit of up to $100,000 for eligible nonprofit small business corporations and permit eligible nonprofit small business corporations to auction the tax credits to private investors. Proceeds of the auction may be used for limited purposes, including matching funds for grant and expansion of the nonprofit's workforce.
PA | Tax Credit for Contributions to Certain Nonprofits
SB 337 would allow a tax credit of up to $200 for individuals and $400 for joint filers for voluntary cash contributions made to certain nonprofits providing assistance to the working poor.
TX | Property Tax Exemption for Community Business Organizations
SB 564 would exempt property used by certain nonprofit community business organizations from ad valorem taxes when the property is used to provide services to aid in the economic development of local communities. For further information on this legislation see the Texas Nonprofit Association of Nonprofit Organizations public policy page.
Institutional Structure and Management
CA | California Public Records Act Applicable to Certain Nonprofits
SB 218 would amend the California Public Records Act to include nonprofit corporations that receive public funds or perform certain governmental functions in the definition of "state agency". The bill would make the provisions of the California Public Records Act applicable to such nonprofit corporations.
IL | Reversion of Gift Certificates
HB 3703 would provide that any value remaining after the expiration date on a gift certificate issued by a nonprofit organization will revert back to the nonprofit organization.
MA | Retirement Benefits for Employees of Nonprofits Performing State Services
HB 2490 would make certain employees of certain nonprofit organizations eligible to use their employment as creditable service for retirement purposes. "Creditable service" is time spent working as a Massachusetts public employee, and for which you have paid or transferred retirement contributions. To be eligible, the employee will have to pay into the annuity savings fund of the state retirement system.
MA | Diversity in Proposal Review Teams
HB 3038 would require certain nonprofit corporations that request state funding to ensure that a team of diverse individuals evaluates the proposed use of the requested funds. The evaluators should include individuals that reflect the geographic area(s) and demographics of the population to be served by the proposal.
MN | Minnesota Emergency Employment Development Act
HF 1326 would allow certain nonprofit employers to receive state funding under the Minnesota Emergency Employment Development program for certain purposes, including payment of wages and benefits to eligible employees and for the purposes of administering temporary employment projects.
TX | Diversity on Nonprofit Board of Directors and in Contracts with Nonprofits
SB 1196/ HB 1402 would require certain nonprofit corporations to maintain a Board of Directors that reflects the diversity of the organizations constituents, would subject those nonprofits to the requirements of the Open Records Act, and would require those nonprofits to make efforts to award contracts to historically underutilized businesses. For further information on this legislation see the Texas Nonprofit Association of Nonprofit Organizations public policy page.
AL | Elected Officials Engaged in Fundraising For Nonprofits
HB 657 would amend existing law to exclude "solici[tation] of funds [by an elected official]. . . on behalf of a . . . tax exempt nonprofit organization without personal gain for himself or herself or a family member from the fund-raising activity" from the definition of "conflict of interest."
TX | State Partnerships with Faith and Community Based Organizations and Capacity Building
HB 492 would create Faith and Community Based Organization Liaisons for the purpose of enabling such organizations to forge stronger partnerships with the state government in providing charitable and social services to state residents. The bill would also establish the Renewing Communities Account, a general revenue fund for capacity building for faith based and community organizations and other purposes. For further information on this legislation see the Texas Nonprofit Association of Nonprofit Organizations public policy page.
CA | Labeling Requirements for Solicitation Bins
AB 918 would require nonprofit organizations to label certain solicits bins with specific organizational information, including the organization's charitable trust number if the bin is owned by a nonprofit organization.
MA | Creation of the Commonwealth Community Fund
HB 205 would establish the Commonwealth Community Fund (CCF) to provide emergency operating grants for community-based non-profit organizations.
ME | Fundraising Through Unlicensed Games of Chance
LD 831 would allow some nonprofit organizations to conduct games of chance without a license. The bill would also require organizations conducting unlicensed games to register with the Chief of State Police for a fee of $30.
PA | Nonprofits May Hold Poker Tournament Fundraisers
HB 662 would amend existing law on games of chance to allow certain nonprofits to run poker tournaments for the purposes of raising funds for the promotion of charitable or civic purposes.
MA | Study of Administrative Fees Charged by Nonprofit Fundraisers
HB 1286 would establish a commission to investigate administrative fees charged by nonprofit fundraisers. Based on the investigation, the commission will make recommendations about the possible imposition of a ceiling on administrative fees and reporting requirements on the percentage of donations actually received nonprofits.
NY | Certain Charitable Solicitations Held in Trust
AB 5990 would allow the Attorney General to require that any funds or property solicited by a charitable organization be held in trust for the benefit of the charitable organization if the organization is sued in the name of the people of the state of NY. The bill would also require any persons that solicit over $5000 in contributions for the benefit of an individual to register as a charitable organization within thirty days of receiving the excess of the $5000.
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Register here for the March 25 webinar on "Fund-Raising In The Recession" from the Chronicle of Philanthropy.
Find your local state association of nonprofits