Nonprofit Advocacy Matters | July 6, 2010

Nonprofit Capacity Building: Stories of Impact

Thanks to the direct advocacy of State Associations during Lobby Day in support of funding for Nonprofit Capacity Building Programs, as well as other nonprofit communications, Members of Congress and staff are asking more questions about the programs and wanting to know what impact nonprofit capacity building programs are having in communities. Help us make the case by sending us your stories of capacity building impact.

This August: Introduce, Impress, Influence

Advocacy begins at home! That's our message in advance of the five-week (Senate) or six-week (House) recess that begins July 31 when policymakers are back in their states. As one congressional staffer told us last week, District Directors are scrambling to fill all that time with meetings and opportunities for the politician to connect with constituents. This is the ideal time to introduce your organization to your federal officials, impress them with the impact of your work, and influence their thinking in your favor.

State Budget Showdowns

The 2011 fiscal year for most states began last week with continued uncertainty and turmoil as states made further spending cuts to deal with depressed tax receipts. The failure of Congress last month (see related article below) to extend Federal Medical Assistance Percentages (FMAP) funding left many legislatures scrambling to fill budget holes. Without these funds, states will make even deeper spending cuts and more tax increases than previously planned. Here is a sampling from the states:

• California: Lawmakers were sent home for the scheduled July recess without reaching a deal to close the state's projected $19.1 billion deficit. The joint budget conference committee will continue to negotiate and other legislators are on notice that they may be called back to Sacramento if a deal is reached.
• Delaware: Contrary to actions taken in most other states, Delaware's $3.3 billion budget signed last week increases spending by 7 percent.
• Illinois: The Illinois Legislature delegated the tough budget decisions to the Governor, while counting on about $750 million from the FMAP program.

• Massachusetts: The new $27.6 billion budget cuts spending and eliminates jobs. The loss of an anticipated $687 million in federal FMAP funds forced budget negotiators to come up with two versions of the state budget - one that included the money and one that did not.

• North Carolina: The Governor signed adjustments to the 2010-2011 state budget that contains $800 million in cuts, including reductions in funding for many nonprofits. An additional one percent in funding cuts go into effect on January 1 if Congress doesn't extend $500 million in FMAP support to North Carolina.

New York: Charitable Deduction Limitation Debated

The NY Legislature is considering a proposal from Governor David Paterson to cut in half the value of charitable deductions made by taxpayers who earn more than $10-million annually. Currently, higher-income taxpayers are permitted to deduct only half of their charitable contributions. The new proposal would cut that limitation in half, allowing very high earners to deduct only 25 percent of their donations, thus significantly reducing the incentive to give.

North Carolina: Bill to Withhold Oversight Funds from Grants Dies

The North Carolina General Assembly adjourned without passing legislation that would have allowed state agencies to withhold up to two percent from grants to nonprofit organizations in order to pay for oversight. A coalition of more than 240 nonprofits, led by the N.C. Center for Nonprofits, opposed the withholding provision because it would have cut into the essential services that nonprofits provide in all 100 counties of the state.

New Jersey: Princeton University Urged to Increase PILOT Payments

Local officials in New Jersey are calling on Princeton University to increase its payments in lieu of taxes (PILOTS), claiming that the university's tax liability would be about $28-million if all its property were taxed by local jurisdictions. Currently, Princeton pays about $10 million a year in taxes and sewer fees, and made a $1.2-million voluntary payment last year under an agreement due to expire in 2011. Only a third of 30 top research universities made regular voluntary payments to their cities or towns, according to a January Chronicle of Higher Education survey.

Nonprofits to (Pay For) the Rescue

Pittsburgh city officials are asking nonprofits to pay up to half of the costs of rescue emergency services in the area. The plan would require municipalities to match the nonprofits' contributions, either dollar-for-dollar or with in-kind contributions.

FMAP and Giving Incentives Legislation Stalls in Senate

Despite repeated efforts throughout June, Senate Democratic leaders were unable to secure the 60 votes needed to cut off a filibuster and pass the American Jobs and Closing Tax Loopholes Act (H.R.4213) prior to the July 4th recess. As a result, Congress neither extended $16 billion in Federal Medical Assistance Percentage funds to the states, nor renewed the IRA rollover and other charitable giving incentives. Congress did pass and the President signed a bill increasing the amount Medicare pays medical professionals and providing temporary pension funding reforms that will provide relief to some nonprofit and other employers.

Nonprofit Sector & Community Solutions Act

Introduced June 15, the Nonprofit Sector and Community Solutions Act is officially  bi-partisan with the co-sponsorship of seven Representatives, and there is growing interest in the Senate as well. Read the latest on the landmark nonprofit legislation, including a letter from Representatives McCollum, Ehlers and Loebsack sent last week to Members of Congress, and sign up to show your organization's support for the bill.