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Nonprofit Advocacy Matters | May 7, 2012

Posted: 
May 7, 2012
New York Gets Nonprofit Liaison to Help Fix Contracting Flaws  
In what is only the second time in U.S. history, a state governor has recognized the essential link between a healthy nonprofit sector and the success of the state by appointing a top-level executive to serve as liaison between government and nonprofit service providers. New York Governor Cuomo named longtime nonprofit leader and capacity builder Fran Barrett to the newly created position of InterAgency Coordinator for Not-for-Profit Services. Barrett will work to reform the state’s procurement and contracting system by improving the way nonprofits and local governments work together as service providers. The post was inspired by a similar cabinet-level position in Connecticut, first created in 2011.
 
"Fran Barrett is a uniquely qualified veteran with experience in nonprofit management and governance and who knows how to improve the performance of nonprofit organizations,” said Michael Clark, President of the Nonprofit Coordinating Committee of New York, on whose board Barrett had served. "This is a move in the right direction,” said Doug Sauer, CEO of the New York Council of Nonprofits. "The Governor chose someone who is knowledgeable and experienced, who knows nonprofits and knows the government's funding and contracting systems.”

Nonprofit Advocacy Matters | Special Edition | Expanding Nonprofit Advocacy to Strengthen Local Communities

Posted: 
May 3, 2012
Special Edition
 
Expanding Nonprofit Advocacy to Strengthen Local Communities
 
We know you receive a lot of email every day, so we don't send out Special Editions unless there are broad implications for the nonprofit sector.
 
The National Council of Nonprofits, the nation’s largest network of nonprofit organizations, and the Center for Lobbying in the Public Interest (CLPI), a recognized leader in nonprofit advocacy training, announced that they have joined forces. CLPI has transferred its nonprofit advocacy training materials and website to the National Council. 
 
When completed, this move will expand the ability of the more than 25,000 nonprofit members of the National Council of Nonprofits’ Network of State Associations of nonprofits, Nonprofit Allies, Nonprofit Affiliates, and State Policy Allies to put CLPI's powerful resources to work in their local communities.

Nonprofit Advocacy Matters | April 23, 2012

Posted: 
April 23, 2012
Take Action
Paying Nonprofits Their Due, Literally (With Your Help)
When more than 300 professionals from the nonprofit and government sectors come together on a national webinar, the topic must be significant. And it is. The April 19 call, hosted by the National Council of Nonprofits and the network of State Associations, revealed common recognition that nonprofit organizations providing services to the public pursuant to contracts and grants with governments are not getting paid the full costs of those services, particularly when it comes to reimbursement of their indirect costs. Participants appeared to agree on two solutions: better education for nonprofits and better rules from government. Individual nonprofits can take action on both solutions.
 
The webinar program explained the basics of indirect costs, including what they are and how they work. It also allowed smaller and larger nonprofit organizations to relay their experiences. A policy analyst with the White House Office of Management and Budget (OMB) explained the pending Advance Notice of Proposed Guidance, inviting public comments on ways to reduce burdens on grant recipients and better coordinate and streamline reporting requirements. Officials from the U.S. Government Accountability Office (GAO) shared results from their report on the nonprofit sector that found the treatment and reimbursement of indirect costs vary among grants and depend significantly on federal, state, and local government practices, and they previewed some upcoming work. Watch the webinar.
 
Working Toward Solutions: Nonprofits can help the people they serve and their colleague organizations by taking one or more of these steps:

Nonprofit Advocacy Matters | April 9, 2012

Posted: 
April 9, 2012
Federal Issues
 
Senate Returns from Spring Break with Issues of Interest to Nonprofits
The U.S. Senate returns from a two-week recess to take on two issues that could impact the work of nonprofits – the Buffett rule tax hike and postal reform. Next Monday, the Senate is scheduled to take a procedural vote on the "Paying a Fair Share Act" (S.2230), a bill to require millionaires to pay at least 30 percent of their income in taxes. The measure is nicknamed the “Buffett rule” after billionaire Warren Buffett who has complained famously that he pays a much lower effective tax rate than his middle-class executive assistant. Although the bill is not expected to pass the Senate’s 60-vote procedural minimum, let alone the House, it expresses a significant and positive norm by maintaining the incentive for charitable giving through the exemption of charitable donations from the new tax. Prior to its annual spring break, the Senate postponed action on postal reform legislation that would close an $11 billion budget deficit of the Postal Service, but would not alter nonprofit postal bulk rates as proposed in a House bill. Congress is under pressure to pass an overhaul bill before a moratorium on closing postal facilities expires on May 15.

Nonprofit Advocacy Matters | March 26, 2012

Posted: 
March 26, 2012
Federal Issues
 
House Budget Would Cut Spending, Reform Taxes
The House Budget Committee approved a budget that would cut spending more than previously agreed by Congress and protect defense from scheduled cuts – actions that could shift burdens onto nonprofits. Viewed largely as an election-year political statement by the Republican majority, the House FY 2013 budget resolution is not expected to be approved by the full Congress due to strong opposition from the Democratically-controlled Senate, which is expected to insist on spending caps established in the Budget Control Act enacted last August. The House budget would reduce spending by $5 trillion over ten years through spending cuts and entitlement reforms, including a modified voluntary voucher program for Medicare-eligible seniors. The House measure also calls for simplifying the tax code by decreasing the number of tax brackets to two, a 15 percent rate and 25 percent rate, and repealing the adjusted minimum tax (AMT). The budget proposes spending more on defense than sought by President Obama, and it ignores the $55 billion in automatic defense cuts required to occur in January 2013 as part of the Budget Control Act.
 
OMB Hears Nonprofit Concerns on Federal Grantmaking Rules
The White House Office of Management and Budget is seeking feedback from nonprofits on its Advance Notice of Proposed Guidance that explores ways to reduce burdens on grant recipients and government agencies and better coordinate and streamline reporting requirements. On a call for nonprofit organizations conducted March 16, the Office of Management and Budget explained its proposals for reducing audit burdens, modifying cost-reimbursement rules (including consideration of a flat rate for indirect costs), and reforming administrative requirements for federal grants. Concerns were raised during the call about lack of corrective action in response to a 2010 Government Accountability Office report that highlighted the confusion surrounding indirect cost recovery and the practice by the states of keeping for themselves some of the federal funds allocated for indirect costs. The National Council of Nonprofits seeks input from nonprofit organizations about their experiences in negotiating indirect cost rates and their indirect cost recovery from governments at all levels. The deadline for filing comments on the OMB recommendations has been extended to April 30.

Nonprofit Advocacy Matters | March 12, 2012

Posted: 
March 12, 2012
Federal Issues
 
Federal Budget State of Play
Less than a week before House Republicans are expected to release their budget proposal for the fiscal year that begins October 1, no agreement has emerged on how to allocate $109 billion in spending cuts mandated by the Budget Control Act passed last August. That Act imposed $1.2 trillion in cuts over ten years, divided equally between defense spending and domestic programs. Since shortly after the deal was struck in August, many Members of Congress, primarily Republican, have called for shifting some of the defense cuts over to the domestic side of the ledger. The House Republicans’ current discussions center on whether to make deeper cuts in discretionary programs or incorporate savings through reforms to mandatory programs like Social Security, Medicaid, and Medicare. Additionally, conservative Members are insisting on a lower budget spending cap that would result in cutting even more than the $109 billion in automatic cuts. Republican leaders reportedly are seeking agreement on a House budget resolution in order to draw a clear political distinction from the Democratic-controlled Senate, which is not scheduled to adopt a budget of its own, opting instead to rely on the Budget Control Act parameters.
 
Feedback Sought on Federal Grant Policy Proposals to Ease Nonprofit Recordkeeping, Costs
The White House Office of Management and Budget is seeking feedback from nonprofits on its recently published ideas to reduce audit requirements, modify cost reimbursement rules, and reform administrative requirements for federal grants to nonprofit and other entities. The Advance Notice of Proposed Guidance was issued February 28 as part of the President’s red-tape review initiative designed to increase efficiency and effectiveness of grant programs by eliminating unnecessary and duplicative requirements. The Advance Notice focuses on possible reforms to: 1) audit requirements that would reduce burdens while targeting investigations; 2) cost principles, such as providing a flat rate for indirect costs; and 3) various administrative requirements. Of particular interest to nonprofit organizations, the proposals seek to require coordination of federal agency demands in order to reduce duplication and reduce burdens on pass-through entities and sub-recipients of federal funds. Public comments on the proposals and suggestions for further regulatory action are due March 29, 2012.
 
The Office of Management and Budget is hosting a special conference call on Friday March 16 at 1:30 pm Eastern for nonprofits to discuss the Advance Notice and readers of Nonprofit Advocacy Matters are invited. Space is limited, so send us your RSVP as soon as possible.

Nonprofit Advocacy Matters | February 27, 2012

Posted: 
February 27, 2012
2012 Public Policy Agenda
The National Council of Nonprofits has released its 2012 Public Policy Agenda that addresses issues affecting all nonprofit organizations at the local, state, and federal levels, such as protecting their tax-exempt status and promoting giving incentives. Added within the framework of six distinct policy areas (such as tax policy and nonprofit advocacy rights) for 2012 is language addressing two emerging policy trends that challenge the ability of nonprofits to pursue their missions: “mandatory volunteerism” and nonprofit independence. To learn more about the National Council’s 2012 Public Policy Agenda, see our press release.
 
Federal Issues
 
Payroll Tax Cut, Benefits Extension Enacted
Congress and the President reached agreement on extending tax and benefits provisions that were scheduled to expire. The Middle Class Tax Relief and Job Creation Act of 2012, approved by Congress and signed into law by President Obama earlier this month, includes continuation of a two-percent individual payroll tax cut, reauthorization of the TANF program through December (a three-month extension), extension of unemployment benefits for up to 73 weeks in some states, and a two-year delay on the 27.4 percent Medicare reimbursement cut to physicians (known as the Doc Fix). The law does not renew any of the expired tax provisions, such as the IRA rollover or other incentives for food, book, or computer donations to charity.
 
Elections and Non-Charitable Nonprofits
As the election season heats up, policymakers are increasing efforts to curb what they consider to be abuses by misuse of certain types of nonprofit organizations. But this year, it appears they finally recognize the legal distinctions between the different categories of nonprofit organizations, in that 501(c)(3) nonprofits – unlike other nonprofit organizations – already are prohibited from engaging in partisan election activities. A bill in the House to require greater disclosure of the names of donors expressly excludes charitable nonprofits. Likewise, when a group of Democratic Senators sent a letter to the IRS regarding potential abuses of tax law regarding electioneering, they expressly limited their inquiry to 501(c)(4) “social welfare” nonprofit groups. Despite these positive signs, charitable nonprofits should be on alert to correct and clarify news reports and statements of policymakers that fail to distinguish 501(c)(3) organizations from other nonprofits; otherwise public perceptions of the charitable sector and unwarranted regulations may arise.

Nonprofit Advocacy Matters | February 13, 2012

Posted: 
February 13, 2012
Federal Issues
 
President’s Proposed Budget Maintains Course
President Obama today proposed a $3.8 trillion budget for the next fiscal year (to start Oct. 1) that follows the deficit reduction agreement reached with Congress last August and would avoid automatic spending cuts of $1.2 trillion (known as sequestration) through increased revenues and targeted spending reductions. The budget blueprint calls for raising $1.5 trillion in new revenue over ten years by allowing the Bush-era tax cuts to expire for families earning more than $250,000 annually and limiting the value of their itemized deductions, and by raising taxes on millionaires. The budget proposal includes $350 billion to fund short-term measures for job growth, including extension of the payroll tax cut and unemployment benefits, and hiring tax credits. While release of a president’s budget proposal normally marks the kickoff of Washington’s annual appropriations cycle, today’s release is unlikely to alter agendas or propel serious debate due to election-year politics by both political parties. Senate Majority Leader Harry Reid (D-NV) has already announced that the Senate will not be adopting a budget resolution, leaving it to appropriators to pass individual spending bills that fall within the August deficit reduction agreement.
 
New Tax Proposals to Both Limit and "Maintain" Charitable Giving Incentive
The President’s non-binding budget once again proposes limiting the value of charitable and other itemized deductions for individuals earning $200,000 and couples earning $250,000 per year. Congress has refused to act on the proposal since it first surfaced in 2009. The budget proposal released today and recently introduced legislation seek to raise taxes on high earners, while maintaining their incentive for donating to the work of charitable organizations, at least as that rate would be limited by the oft-offered but rejected cap. The goal of the so-called “Buffett rule” is to require individuals earning more than $1 million, and in particular those who have large capital gains subject to a lower tax rate, to pay at least 30 percent of their income in taxes. Although most of their tax deductions would be eliminated under the plan, charitable donations are expressly exempted in the proposals, meaning that the incentive for charitable giving would be maintained essentially in a modified form. As the two Obama proposals affecting charitable deductions indicate, it is too early in the legislative process to determine how the challenges to the charitable giving incentive will turn out. Election-year politics could give life to proposals, such as those considered last year by the Joint Select Committee on Deficit Reduction, to limit the value of charitable and other deductions as part of a larger budget or tax reform deal.  
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