Sign On Now
Nonprofit Letter to Federal Leaders: Provide COVID Relief Tailored to Nonprofits
Congress is racing to respond to President Biden’s call for an immediate COVID relief package to fight the pandemic and recession. House committees will be writing legislation this week and next; floor action will follow shortly thereafter. The best things readers can do at this moment to influence the outcome of this legislation are to (1) sign their organization onto the new nonprofit coalition letter to join with more than 2,700 charitable nonprofits in urging support for key priorities; and then (2) forward the letter to your colleagues at other nonprofits to increase the number and thereby nonprofits’ clout.
The letter, which will be updated to show additional nonprofit signers, calls on Congress and the Administration to agree to the following:
- Provide Nonprofit-Specific Grants, Forgivable Loans, and Refundable Tax Credits for All Nonprofits
- Strengthen Charitable Giving Incentives
- Provide 100% Unemployment Benefit Reimbursement to nonprofits that self-insure these benefits
- Provide Substantial Financial Aid to State and Local Governments to, among other things, prevent governments from imposing new costs and burdens on their nonprofit partners
Read the Letter ♦ Sign On Now! ♦ Forward the Letter
Congress Moves Closer to $1.9 Trillion COVID Relief Legislation
The Senate and House passed a budget resolution on Friday, advancing the process for passage of a Democrats-only COVID relief bill in March. Bipartisan negotiations may still take place, but the Democratic majorities now have their fallback strategy in place. The budget resolution instructs 25 House and Senate committees to develop legislation within certain parameters. The committees intend to complete their work within two weeks to allow enough time to pass the budget reconciliation bill before the expiration of extended and expanded unemployment benefits on March 14, 2021.
In a joint statement last week, House Speaker Pelosi and Senate Majority Leader Schumer laid out the priorities of the budget reconciliation bill. Those priorities include: “immediate relief for individuals and families throughout 2021 including $1,400 per-person and per-child direct payments, an extension of Unemployment Insurance programs through September 2021 with a $400/week federal enhancement and $350 billion in critical state, local, Tribal and territorial fiscal relief,” and “expanded PPP assistance for nonprofits.” These priorities align with President Biden’s $1.9 trillion American Rescue Plan, although some details may vary based on negotiations with Republicans and the idiosyncrasies of the budget reconciliation process.
Happening This Week
House Committees Mark Up COVID Relief
The budget resolution instructs specific House and Senate committees to craft legislation for the budget reconciliation bill. Nine House committees begin work this week with the goal of having the reconciliation package ready for House floor action the week of February 22. The House Small Business Committee plans to meet on Wednesday (2/10) to consider proposals to expand the Paycheck Protection Program to enable some larger nonprofits with multiple locations to secure forgivable loans. It will also address
other changes to the PPP and the expansion of Economic Injury Disaster Loan (EIDL) grants. The House Ways and Means Committee – which must adopt unemployment legislation, among other things – is scheduled to meet this week on Wednesday (2/10) through Friday (2/12).
- Redistricting Census Data Delayed: The results of the 2020 Census will be delayed by several months – until approximately April 30, the U.S. Census Bureau recently acknowledged. Data on the count of every person in the United States was supposed to be delivered to the President on December 31, 2020, but the pandemic, data anomalies, and political interference made that impossible. Separately, the granular information needed for redrawing congressional and state legislative districts will not be delivered until after July 30, well after most state legislatures have adjourned for the year. Learn more from
this blog posting from the National Conference of State Legislatures, 2020 Census Delays and the Impact on Redistricting.
- Families First Act Paid Leave: The IRS has updated guidance to reflect the extension through March 31, 2021 of the refundable payroll tax credits for employers with 500 of fewer employees for paid sick and family leave initially established in the Families First Coronavirus Response Act. The incentive for providing paid leave is voluntary, and the year-end COVID relief law did not extend the mandated paid leave provisions of the Families First Act. The updated guidance provides links to numerous other updates to help employers calculate and claim the refundable payroll tax credit.
Share Your Story
Congress is debating additional COVID relief, and federal agencies and departments – particularly the Small Business Administration and Treasury Department – are in the process of answering questions and implementing the law enacted at the end of 2020. You can help nonprofit advocacy efforts to secure legislative solutions and helpful guidance by completing the brief form: Let us know how COVID-19 is affecting your nonprofit.
States Extending Support for Nonprofits
State legislative sessions have started in earnest, and policymakers in some states are advancing grant and funding programs that may benefit charitable nonprofits. California lawmakers have proposed using $2.6 billion from its share of federal coronavirus relief funds (CRF) to create the Keep California Working Grant Program, which would provide grants to nonprofit organizations and small businesses suffering economic hardship due to COVID-19. In Washington State, legislators are debating several proposals that would allocate up to $250 million in coronavirus relief monies for additional grants to
organizations providing housing, food, education, childcare, COVID-relief, and more. Another Washington bill would extend state expenditure deadlines for CRF funding. Similarly, North Carolina legislators have already sent to the Governor for his signature a bill extending deadlines for their federal funding expenditures as well as state tax credits for families with children in remote education.
Kentucky policymakers are considering appropriating $20 million for direct relief payments to eligible small nonprofits for one-time grants of up to $10,000. A separate bill would allocate an additional $220 million for small businesses, including nonprofits in certain subsectors. Last week, a Pennsylvania Representative reintroduced legislation that would establish the Nonprofit Assistance Grant Program with $100 million for grants up to $50,000 for expenses and losses due to COVID-19. Along the same lines, the New
Hampshire Legislature is considering establishing the Save Our Granite Stages Program and a COVID-19 Micro Enterprise Relief Fund.
COVID-Related Unemployment Insurance Relief a Top Action Item
State legislatures and administrative agencies are fast-tracking unemployment insurance relief nearly one year into the pandemic and economic crises. Two bills advancing in Kansas (HB 2195 and HB 2196) would hold harmless reimbursing and contributing employers, including nonprofits, by prohibiting any employer’s account from being charged for any benefits paid and freezing automatic rate increases. The relief would be retroactive to the beginning of the pandemic. Likewise pending legislation in Maryland, Mississippi, and New Mexico would also limit or prohibit unemployment insurance rate increases for contributing employers. Minnesota has already enacted such legislation, and Washington State lawmakers have sent a bill to
Governor Inslee that would do the same. In Delaware, nonprofits with a balance of reimbursable unemployment claims related to COVID-19 may self-certify and request that federal CARES Act funding be allocated to their accounts.
Last month, the New York State Department of Labor issued an order temporarily modifying the unemployment benefit charging system and easing the burden for COVID-related unemployment insurance charges. The order relieves all employers, including reimbursing nonprofits, of all charges for unemployment costs dating back to the beginning of the pandemic. Governor Cuomo signed legislation that prohibits increases in unemployment insurance taxes for contributing employers that have laid off workers for
COVID-related reasons for the duration of 2021. A bill in Utah would require certain nonprofits to notify an employee when they would be unable to claim service performed for the nonprofit as employment for the purpose of qualifying for unemployment insurance benefits.
Taxes, Fees, PILOTs Re-Emerge
It’s predictable: when state and local governments face budget shortfalls, they often turn to, and turn on, their nonprofit partners for revenues, typically in the form of new taxes, fees, and so-called “voluntary” payments in lieu of taxes (PILOTs). Here are recent examples of this trend:
- Montana: A bill that would have allowed local governments to impose new costs and fees on nonprofits operating in special districts died because it was tabled in committee.
- New Hampshire: Nonprofit property tax exemptions are coming under scrutiny in the Granite State. One bill would require educational and charitable organizations to annually file with the municipality for property tax exemption. A separate measure seeks to establish a commission to study payments in lieu of taxes.
- New York: A series of bills seek to redefine property tax exemption in New York. The first measure would restrict the exemption to nonprofits organized for charitable purposes that can prove by clear and convincing evidence that each acre is actually used for a charitable purpose at least 120 days a year. Another bill would condition tax exemption of vacant or unused land owned by a nonprofit on whether there are definite plans for utilizing and adapting the property for exempt purposes to commence within
five years. A final measure would require the nonprofit property owner to annually establish its right to a property tax exemption on the property owner. On the positive side, this last bill would require that nonprofits be consulted to develop guidance documents for assessors.
Getting Ahead of Change
Nonprofits know the value of getting to know policymakers once they take office. But what about getting ahead of changes to promote sound policies and working relationships? In California, that’s exactly what nonprofits are doing.
Consider the situation in California in the aftermath of the presidential election. President Biden has selected California Attorney General Becerra to serve in his cabinet. If Becerra is confirmed as Secretary of Health and Human Services, California Governor Newsom will have the duty and opportunity to appoint a new AG to enforce all manner of state statutes, including the laws governing nonprofit corporations, solicitations, and operations. As the cop on the nonprofit beat, the AG can investigate, litigate, and shut down nonprofits in the state, and can promote policies that help make the sector transparent and vibrant, and build on partnerships that strengthen communities.
CalNonprofits, the state association of nonprofits, decided it would make sure - rather than assume - the Governor appreciated the importance of the appointment to the health and wellbeing of nonprofits. They sent a proactive letter to Governor Newsom urging him to consider the impact and concerns of the nonprofit community, stressing that the “quality of leadership of the Attorney General matters deeply to the nonprofit community.” The letter recommends five priorities for anyone appointed to serve as Attorney General:
- Continue to be proactive and assertive in pursuit of scammers pretending to be nonprofits.
- Support the development of new regulations to respond to the now-prevalent online donation industry.
- Promote policies that protect and strengthen nonprofits as key service providers, employers, and economic drivers.
- Support efforts to increase transparency and accountability of donor-advised funds (DAFs) and sponsors.
- Continue to recognize the inequities in our state and seek opportunities to remedy those inequities.
In closing, the letter stresses, “we look forward to working with the new Attorney General to keep California’s nonprofit community strong as we continue to step up to serve Californians, provide jobs, and support economic recovery.”
The point of the closing sentence, and the whole letter, is that nonprofits and governments serve the public good. As a result, more often than not their interests are aligned. So it is imminently appropriate for nonprofits to advocate for partners who share common values and a commitment to high ideals.
Read more examples of Advocacy in Action,
a regular feature of Nonprofit Advocacy Updates.