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Welcome to the Nonprofit Champion, our biweekly public policy newsletter. This email format provides brief digests to help readers quickly access necessary information. For more details about a specific item, see the full newsletter posted online Nonprofit Champion | July 10, 2023.

Top of the News

The Appropriations Grind is On

The debt limit and spending cut plan negotiated by President Biden and Speaker McCarthy last month was supposed to restore financial stability by establishing a bipartisan framework for upcoming spending decisions. Partisanship, however, seems to have other plans. House Republicans have advanced spending measures that, so far, are $119 billion below the budget levels agreed to by the Speaker and President and approved by Congress. Further, an incentive for Congress to pass all of their appropriations bills by the end of the year may result in added cuts and frustrate passage of “earmarks,” line-item appropriations to individual charitable nonprofits. [Read more]

Why It Matters: More extreme spending cuts and the failure of Congress to provide targeted support in the form of direct spending on charitable projects could significantly hinder the ability of organizations to serve the public and advance their missions.

Supreme Court Issues Landmark, Controversial Decisions on Affirmative Action, LGBTQ Rights, Student Loan Debt

The U.S. Supreme Court issued a series of controversial 6-3 decisions on the last days of its term that overturned long standing precedents as the conservative Justices banded together to redefine aspects of civil rights in America. The Court struck down race-conscious admissions at Harvard and the University of North Carolina, blocked enforcement of a Colorado law that prohibited businesses that serve the public from discriminating based on sexual orientation, and ruled that the Biden Administration exceeded its authority in advancing a program to cancel student loan debt of up to $20,000 for more than 40 million borrowers. [Read more]

Why It Matters: These decisions affect the work of charitable nonprofits in varying ways and the underlying policy and constitutional questions will likely be before the courts for years to come.

In Focus:
Public Service Loan Forgiveness (PSLF) Program

Although a recent Supreme Court decision blocked the Administration’s plan to cancel student debt, a powerful incentive supporting employment at charitable nonprofits and governments remains in full effect – and has even gotten better in recent days. The Public Service Loan Forgiveness (PSLF) program enables individuals who work for 10 years at charitable nonprofits or governments to earn forgiveness of any remaining federal student loan debt. New regulations expand the number of student loan borrowers who will be able to apply for loan forgiveness under PSLF. Pending legislation could further reduce the costs for borrowers. [Read more]

Why It Matters: The PSLF remains a valuable resource for nonprofit employers and employees, both as an inducement that can help alleviate the nonprofit workforce shortage crisis and as a program that reduces burdens on individuals who commit themselves to public service.

Federal News

FastView

Looming Child Care Cliff: On Sept. 30, federal pandemic-related funding for child care providers ends. As a result, 70,000 programs could close, eliminating 3.2 million slots for children and $9 billion in annual earnings by parents. [Read more]
Opportunity Zone Tax Policy Falling Short of Expectations: A tax policy designed to boost economically challenged areas fails to deliver investments in the poorest neighborhoods and regions, according to a new report from the Treasury Department. [Read more]

State & Local News

New Laws Affecting Nonprofits

July 1 marked the beginning of the new fiscal year in 46 states and the start date on several new laws of interest to charitable nonprofits:

Audit Threshold: The threshold for mandated audits of charitable nonprofits went up in Connecticut and Mississippi, while new, higher audit threshold in Illinois and New Mexico will go into effect at the beginning of 2024.
Data Privacy: Many states have enacted data privacy laws over the past two years that provide protections for individuals and impose mandates on how various entities store and utilize personal data. Colorado’s new law applies to nonprofits while the Connecticut statute exempts charitable organizations.
Employment Policies: States have enacted several new employment policies including paid leave (Minnesota), retirement security (Vermont), paid time off to vote (Georgia), and disclosure of the use of artificial intelligence in the hiring process (New York City).
Minimum Wages: Nevada and Oregon increased their state minimum wage rates, and Virginia amended its minimum wage requirements for employees with disabilities.
Taxes: Indiana now requires nonprofits that conduct sales on more than 120 calendar days per year to collect and remit sales tax.

[Read more]

State Budgets and Nonprofits

Nonprofits secured some progress as state legislatures finalized their budgets before the start of the new fiscal year last week:

Idaho’s budget includes $28 million for the Department of Labor to provide child care business grants.
Maine will require paid leave for workers and is providing $60 million in child care investments that include a wage stipend for child care workers.
Minnesota allocated more than $5 million towards a grants administration unit tasked with creating a new grants management system.
Nebraska has appropriated $40 million for grants of up to $5 million per capital project for qualifying nonprofits in arts, culture, humanities, or sports.
Utah has established the Nonprofit Capacity Fund to fund the Nonprofit Capacity Grant Program to provide grants to certain nonprofit support organizations.

[Read more]

Read the full newsletter for additional quotes, research, Numbers in the News, and upcoming advocacy events to put the news in greater context and help you frame the debate.

Nonprofit Library

On child care

Amid looming ‘child care cliff,’ states scramble to bolster programs, Molly Bolan, Route Fifty, June 24, 2023.

On nonprofit workforce shortages

Centerpoint, Which Educates and Counsels Hundreds of Teens, Is Poised to Close, Alison Novak, Seven Days, July 5, 2023.
‘When nonprofits lose … communities suffer’: Nebraska charities face workforce shortages (2:45), Matt Chibe and Veronica Barreto, KLKNTV, June 28, 2023.

On Public Service Loan Forgiveness

Public Service Loan Forgiveness Untouched by Supreme Court Student Debt Rulings, Tiffany Gourley Carter, National Council of Nonprofits, June 30, 2023.
Fact Sheet: PSLF Final Regulations, U.S. Department of Education, effective July 1, 2023 (implementing Permanent Improvements to the Public Service Loan Forgiveness Program and One-time payment Count Adjustment to Bring Borrowers Closer to Forgiveness).
Lowering Obstacles to Achievement Now (LOAN) Act (H.R. 1731).

On state and local fiscal recovery funds

From Recovery to Revitalization: How Local Leaders Are Unlocking the Potential of the American Rescue Plan Act, National Association of Counties, June 30, 2023.

On the Supreme Court

The Supreme Court just issued its biggest rulings of the year. Here’s what you need to know, Jessica Gresko, AP, July 1, 2023.

On tax incentives

Use of the Opportunity Zone Tax Incentive: What the Data Tell Us, Office of Tax Analysis, Working Paper 123, U.S. Department of Treasury, June 2023.

Advocacy in Action

Preserving, Improving, and Promoting the Public Service Loan Forgiveness Program – For the Public Good

Effective advocacy comes in many forms, addresses diverse audiences, and requires the use of different skill sets over time. The federal Public Service Loan Forgiveness (PSLF) program serves as an ideal example of how nonprofit advocates have advanced the underlying public policy, preserved the support of policymakers and the public, and worked to ensure the promise of earned loan forgiveness becomes a reality for millions of workers.

Read the full article