Nonprofit Advocacy Matters Archive

Posted:

February 1, 2012

Special Edition

Top Ten Nonprofit Policy Issues:

2011 State and Local Policy Review

To anticipate the public policy issues that nonprofits will face at the state and local levels in 2012, it is useful to review the significant policy challenges and opportunities that nonprofits faced in 2011. The following brief analysis shares a sampling of insights that the National Council of Nonprofits gained through its work with the collective network of State Associations of nonprofits and other nonprofit organizations active at state and local levels.

Posted:

January 30, 2012

Take Time to Help Yourself

How Is the Small Employer Health Credit Working for Your Organization?

The Small Employer Health Credit that qualified smaller for-profit and nonprofit organizations may claim to help reduce the cost of employee health insurance has come under criticism for its complexity and low payout rates. We are asking for your help in better understanding how this new program actually works and how it can be improved. The Government Accountability Office (GAO) is looking to speak with nonprofits willing to share their experiences with claiming the Health Credit that was passed as part of the 2010 health care reform act. The GAO will be holding two focus groups that are open to all nonprofits that have applied for the credit to gather information about its overall effectiveness. Read more about the GAO review.

Here are three ways you can help:

Contact the State Association of nonprofits in your state to let them know your experiences with the Small Employer Health Credit – whether you applied for it, or if you decided not to apply for some reason.
Contact the GAO directly to share your experiences.
Spread the word to your colleague organizations about this opportunity to understand and improve this important tool for making employee health insurance more affordable.

Posted:

January 17, 2012

Congressional Agenda Filling Up Quickly

Nonprofits should get some clarity in the coming weeks on a number of federal issues that impact their work in communities throughout the country. The House of Representatives returns this week for a series of hearings and the Senate convenes next week in time for President Obama’s State of the Union Address on January 24. In that speech to Congress and in his budget for the 2013 fiscal year, due to be released in early February, the President is expected to reveal how he thinks Congress should implement the spending cut targets enacted last year. Critical funding issues involving human services, education, arts, health care, and volunteerism are at stake. Also, Congress must take action by the end of February if it intends to extend beyond February the two-percent employee payroll tax cut and continuation of unemployment and food benefits that it passed as an emergency compromise at the end of December. Each of the issues impacts the work of nonprofits, whether as employers or service providers for affected populations.

Posted:

January 3, 2012

2012: Collective Eyes, Ears, and Voice on Policy Opportunities/Challenges

This past Sunday many of the almost 40,000 new laws enacted in the 50 states last year became effective. That list will begin growing even longer soon as most state legislatures reconvene in the coming weeks.

As regular readers of Nonprofit Advocacy Matters know, in 2011 nonprofits throughout the country won most legislative battles at the state level over tax-exemptions, lost ground on government funding for programs that serve individuals and communities, and made progress in strengthening the government-nonprofit relationship in many states.

Posted:

December 12, 2011

Debate Continues on Payroll Tax, Other “Must Pass” Measures

Most of this year’s congressional year-end drama focuses on whether federal policymakers will agree to (a) extend the expiring two-percent payroll tax cut enacted last year and thus prevent a tax increase on January 1, and (b) extend unemployment benefits to millions of jobless Americans. Of course, in Congress, a related issue is what other “must pass” provisions will be attached. The Senate has debated for two weeks over a series of competing payroll tax-cut proposals. The latest Democratic version, held up by a Republican-led filibuster, would cut in half (3.1 percent) the employee share of payroll taxes and pay for it with a temporary surtax of 1.9 percent on millionaires. The House is scheduled to consider a bill this week to extend the two-percent payroll tax cut, as well as delay scheduled cuts to Medicare providers (the so-called “Doc Fix”), extend and reform unemployment benefits, and authorize the controversial Keystone XL Pipeline. Bipartisan negotiations are expected throughout the week aimed at reaching agreements before Members of Congress leave town for the holidays.

Small Employer Health Credit Under Review

The small employer health credit that nonprofit and for-profit employers may claim to help pay for employee health insurance is the subject of ongoing review. Last month, the House Oversight Subcommittee of the Ways and Means Committee heard testimony on whether small business employers are currently benefitting from the Small Business Tax Credit, problems they may be encountering when calculating the credit, and whether the IRS is administering it in a way that ensures tax compliance. Most witnesses stressed that it is too soon to tell whether the tax credit, enacted as part of the 2010 health care reform law, is serving the purpose of making employer-provided health insurance more affordable for smaller employers. The Government Accountability Office is conducting a follow-up study to better understand the barriers that small employers are experiencing, assess IRS education and enforcement efforts, and determine the potential effects of the credit. The National Council of Nonprofits is also eager to learn of your experiences in calculating and claiming the small employer health credit.

Posted:

November 28, 2011

Supercommittee Failure Increases Budget Uncertainty

While Democrats and Republicans escalate the blame game relating to the failure of the Joint Select Committee on Deficit Reduction to reach agreement on a plan to reduce the budget deficit by $1.2 trillion, the direct, if not immediate, impact is clear: automatic spending cuts to domestic and security programs will begin in 2013 unless Congress can agree on some modifications. Under the Budget Control Act enacted in August, $600 billion will be cut over the next ten years from both defense programs and from domestic programs, with the notable exceptions of most entitlement program spending and programs that directly help poor and disadvantaged residents. More urgently, however, the lack of an agreement by the so-called Supercommittee throws into doubt the ability of Congress to resolve several contentious issues before the end of this year, including extension of unemployment benefits, continuation of a payroll tax cut, enacting nine spending bills to fund government operations, and renewal of dozens of business and nonprofit tax provisions that are set to expire December 31.

Federal Charitable Giving Incentive

The Supercommittee’s inability to reach agreement also means the failure of a proposal that was actively being considered: virtual elimination of the charitable giving incentive. As was reported by the Washington Post, National Journal, and Chronicle of Philanthropy, members of the Supercommittee were promoting a proposal by an economist to cap the value of all itemized deductions (e.g., for charitable giving, mortgage interest, and state and local sales taxes) at two percent of adjusted gross income (AGI). If adopted, that would mean that someone earning $75,000 could only receive a tax reduction of $1,500, which for most people would be consumed entirely by their mortgage interest and/or their state and local taxes – thus eliminating any incentive to give to charity. With leadership by the State Associations and many national organizations, including an active role by the National Council of Nonprofits, more than 4,000 nonprofit organizations signed the Nonprofit Community Letter telling Congress that nonprofits cannot withstand any weakening of the charitable giving incentive, and governments at all levels cannot continue to cut public programs and expect nonprofits to fill in their gaps and pick up their slack. Nonprofits need to continue to educate federal policymakers because this issue likely will return.

Posted:

November 14, 2011

Advocacy in Action

The nonprofit sector faces an “all-hands-on-deck” moment to lift more voices to protect the charitable giving incentive. (See the first story, below.) That’s why I am urging you and other nonprofit leaders to join the nationwide advocacy campaign by immediately encouraging all of your members, board members, staff members, volunteers, donors, service recipients, families, friends, and other people who care about the vital services and programs that nonprofits provide in local communities to contact their federal policymakers. The common message: The Supercommittee needs to make a clear statement in support of the charitable deduction and dislodge it from any proposals to cap or reduce the value of itemized deductions. Nonprofits cannot withstand any weakening of the charitable giving incentive, and governments at all levels cannot continue to cut public programs and expect nonprofits to fill in their gaps and pick up their slack.

Please protect those you serve in your communities by taking these two simple steps:

Personally contact your U.S. Senators and Representative (find contact information and key messages here) by calling (202-225-3121), emailing, and/or tweeting; and
Then forward this communication to all you know who care about the vital work that nonprofits do in our communities, urging them to take these two simple steps immediately because the supercommittee is deciding this now!

By taking these two steps, you can lift your voice and mobilize your special networks across America.

Thank you,

Tim Delaney

President & CEO

Supercommittee Deliberations Focus on Deductions

Democrats and Republicans on the Joint Select Committee on Deficit Reduction last week exchanged proposals to reduce the federal deficit. Details have been sketchy as the Supercommittee moves into sensitive negotiations with less than 10 days to reach a non-amendable plan. Each side’s proposal reportedly calls for limiting the value of some or all itemized deductions, such as the charitable giving incentive. The negotiators appear to be focusing on a proposal by economist Martin Feldstein to cap the value of all itemized deductions (e.g., for charitable giving, mortgage interest, and state and local sales taxes) at 2 percent of adjusted gross income (AGI). If adopted, that would mean that someone earning $100,000 could only take a total of $2,000 in itemized deductions, which for most people who currently itemize would be consumed entirely by their mortgage interest and/or their state and local taxes – thus eliminating any incentive to give to charity.

Although some of Feldstein’s writings have suggested that Congress may want to exempt charitable giving from the cap, the limited details released so far about the parties’ two proposals do not mention this option, thus increasing concern for the work of nonprofits. The National Journal reported that “Republicans said that tax deductions for second homes and charitable deductions could be slashed or eliminated as part of the agreement, with Bush tax cuts permanently extended and corporate tax rates possibly reduced.” Others report that the Democrats’ proposal includes a two-step process which identifies itemized deductions as a revenue-generating “placeholder” provision that would be triggered in January 2013 if tax reform legislation is not enacted in 2012.

Last Monday, every member of the Supercommittee received the Nonprofit Community Letter – now signed by more than 4,000 nonprofits from all 50 states – telling Congress that nonprofits cannot withstand any weakening of the charitable giving incentive, and government cannot continue to cut public programs and expect nonprofits to fill in their gaps and pick up their slack. See who has signed so far. The letter, which continues to draw signers because of the urgency of the threat, is also being delivered to every elected official in Congress.

The panel members have until November 23 to come up with a plan, after which an automatic trigger of $1.2 trillion in cuts is imposed on federal domestic spending and defense spending under the Budget Control Act passed in August.

Posted:

October 31, 2011

ACTION ALERT!
Sign on to Protect the Charitable Giving Incentive

The charitable giving incentive that supports the work of all charitable nonprofits is at risk!
See the article below.

Supercommittee Members Reject Dueling Offers, Deliberations Continue

Democrats on the Joint Select Committee on Deficit Reduction (Supercommittee) made an offer last week to cut $3 trillion from the federal budget over the next decade through $500 billion in cuts to Medicare and Medicaid, and as much as $1.3 trillion in new taxes. Republican members of the panel reportedly rejected the proposal and offered a cuts-only counter that did not include tax hikes. Also last week, the Supercommittee during a hearing on discretionary spending Congressional Budget Office Director Douglas Elmendorf asked that members reach their decisions by early November so that his office will have time to estimate their costs well in advance of the November 23 deadline. The Supercommittee is tasked with coming up with a plan by that date to reduce the federal budget deficit by $1.2 trillion through any combination of spending cuts, entitlement program reforms, or revenue increases.

The Campaign to Protect the Charitable Giving Incentive

So far, more than 3,200 nonprofit organizations have signed onto a Nonprofit Community Letter that will be delivered to Supercommittee members very soon expressing the clear message that if policymakers are going to rely on nonprofits to fill the gaps created by their policy decisions, then the 12 members must not undermine the ability of nonprofits to serve our communities by altering the charitable giving incentive. (See Delaney and Gallagher feature columns in the sidebar) In this campaign, language matters. The nonprofit community letter focuses on the “charitable giving incentive,” rather than the current-law “charitable deduction” or any one legislative proposal. Nonprofits recognize that there is room for improvement over the status quo and remain open to dialogue at the appropriate time about how best to encourage individuals to give back to their communities. Also, the Supercommittee reportedly is considering a wide range of proposals for reducing the deficit, each of which includes some form of change to the current incentive. Perhaps the only proposal not under consideration is the one offered by President Obama, and rejected most recently by the Senate, to limit the value of itemized deductions. Learn more. See who has signed. Sign on!

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