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Take Action
It’s Time to Raise a Ruckus
 The burdensome and unfair tax on nonprofit transportation benefits isn’t going to repeal itself. And Congress won’t take action unless and until individual Representatives and Senators know their failure to repeal the new tax is harming their constituents. With all the competing issues and special investigations in Congress, nonprofits have to break through the noise to deliver a clear and simple message. Take two minutes now and call (202-225-3121), email your Representative and Senators, and/or tweet this message: “Don’t hold community nonprofits hostage to partisan bickering; repeal the #nonprofit #transportationtax immediately.”
Your efforts will back up the nonprofit community letter sent to congressional leaders last week urging them to include repeal of the transportation tax in any and all bills moving through Congress right now. They know repeal is the right thing to do; we all need to convince them to do the right thing right now!
Decisions (or Delays) Loom on Funding the Government
The southern border wall figuratively stands between another federal government shutdown and decisions on spending more than a trillion dollars on policies and programs that affect all aspects of American life. On Thursday, November 21, the latest stopgap funding bill, known as a continuing resolution, expires and the federal government will shut down unless congressional leaders and administration officials can resolve longstanding policy disputes. Looming over all decisions is the question whether the White House or congressional Democrats will yield on the President’s demand for more than $8 billion in spending authority to build a wall along the border with Mexico. Held in abeyance are agreements on thousands of spending levels on defense and general government operations, human service initiatives typically performed by charitable nonprofits, and more. If and when decisions are made on spending allocations for the dozen appropriations subcommittees, appropriators can work out the details in their individual bills and start passing legislation. Regardless of the status of spending levels, Congress is expected this week to “kick the can down the road” until mid-December by passing another short-term continuing resolution that keeps the government operating for a few more weeks.
Federal FastView
- Immigration Restrictions Temporarily Blocked: A federal judge has temporarily blocked a recent presidential proclamation blocking entry for incoming immigrants who are unable to demonstrate their ability to obtain health insurance within one month of arrival or to pay for “reasonably foreseeable medical costs.” The judge issued the nationwide temporary restraining order because the “[p]roclamation’s reliance on the health care insurance status of an individual as the sole factor for determining inadmissibility as a public charge conflicts with [federal law].” The proclamation was to take effect November 3 and the restraining order is valid for 28 days. The Trump Administration is expected to challenge the order.
- Private Foundation Excise Tax: The complicated foundation excise tax would be streamlined in bipartisan legislation proposed by Representatives Danny Davis (D-IL) and George Holding (R-NC). The Private Foundation Excise Tax Simplification Act (H.R. 4953) would simplify the current two-tier private foundation excise tax by replacing it with a revenue-neutral rate of 1.39 percent. The Council on Foundations and other foundation-serving organizations sent a letter to House leaders endorsing the bill.
- Tax Statistics Released: The Statistics of Income Division of the Internal Revenue Service released 2017 tax data for State, County, ZIP Code, Metro and Micro area, and Congressional Districts. The Statistics of Income (SOI) data are from selected individual income tax returns and include the number of returns (approximates households), personal exemptions (approximates population), adjusted gross income, and wages and salaries, among other new information. SOI data are often used for informing or shaping tax policy issues and debates.
In Focus
The Johnson Amendment Is Alive and Well!
The 1954 Johnson Amendment – which keeps the rancor of partisan politics away from charitable, philanthropic, and religious organizations – continues to have strong support by Americans. The independent Pew Research Center recently published a report finding “U.S. adults are resoundingly clear in their belief that religious institutions should stay out of politics.” Indeed, “three-quarters of the public expresse[d] the view that churches should not come out in favor of one candidate over another during elections.” According to the research report, the public overwhelmingly rejects “efforts by President Trump to roll back existing legal limits on houses of worship endorsing candidates.”
Despite pronouncements by the President and others, the longstanding Johnson Amendment remains in full force to protect charitable nonprofits, houses of worship, and foundations from demands by politicians of all party stripes, political operatives, and donors to endorse (or oppose) candidates for public office. Last week, a New York judge ordered President Trump to pay $2 million to charities because of misuse of Trump Foundation assets for partisan and personal gain. Among the actions that broke the law was making contributions out of foundation funds to candidate campaigns and donating to charitable organizations in ways closely tied to his 2016 presidential campaign.
Outside of the partisan political realm, organizations are taking steps to remain well within the law. Earlier this month, the Salt Lake City Tribune – Utah’s 148-year-old newspaper – announced it has received approval from the IRS to convert from being a for-profit business to becoming a charitable nonprofit. The paper recognized that the new status as a charitable entity requires changes to fully comply with the law. Specifically, the Tribune declared it will “stop any endorsements of political candidates going forward as required by the law governing nonprofits” (i.e., the Johnson Amendment), while stressing that “the editorial board, which is separate from the news staff, will continue to opine on the big issues of the day.”
2019 Election Results
In addition to deciding hundreds of legislative races and three governorships in Kentucky, Louisiana, and Mississippi, voters this month also approved 19 out of 32 statewide ballot measures in seven states. In Texas, two constitutional amendments passed, one prohibiting the state from establishing an individual income tax and one providing temporary property tax exemptions in disaster areas. In Kansas, voters approved a measure to rely on federal census data for redrawing state legislative districts, repealing the state’s unusual policy of using its own numbers. Voters in Washington State narrowly rejected an affirmative action provision that would have expressly allowed the state to implement policies recognizing certain characteristics (such as race, ethnicity, national origin, sex, color, or age) as factors when considering a person for education or employment opportunities, while continuing to ban the use for preferential treatment. Likewise, Colorado voters rejected a proposal to pare back the austere budgeting restrictions known as Taxpayer Bill of Rights (TABOR). Had it been successful, the anti-TABOR measure would have repealed the mandatory taxpayer refund provision in the law and shifted any surplus revenues to fund public schools, higher education, and transportation.
State Tax Reforms Under Consideration
The start of the 2020 state legislative season is nearly two months away, but many lawmakers are already queuing up tax reform packages. The Utah Tax Restructuring and Equalization Task Force is considering six proposals on how to proceed in rewriting the state tax code. One official tax force recommendation would reduce individual and corporate income tax rates. The recommendations would also expand the sales tax base by imposing taxes on additional services, such as maintenance and repair of real property, fine arts schools, parking lots and garages, certain personal services, and more. The full Utah Legislature is expected to meet in special session in early December.
Further east, lawmakers in Nebraska are also planning state tax reform, primarily focused on property tax adjustments. The issue, which was a sticking point last legislative session, prompted a ballot measure petition to provide property tax relief through income tax refunds or credits equal to 35 percent of local property tax liability. The legislative Revenue Committee may announce a plan later this week to increase the property tax credit fund by $300 million over the next three years, which would help alleviate pressure for the ballot measure, that estimates suggest would cause a $1.5 billion deficit. A bipartisan tax reform council in Kansas held a hearing last week on recommendations for a tax reform package expected for the 2020 legislative session, including decoupling from federal law and changes to sales taxes and education revenue streams.
North Carolina Ends State Taxation of IRA Charitable Rollovers
North Carolina enacted a bill last week that, among other things, ends the state taxation of IRA charitable rollovers. For federal tax purposes, individuals aged 70½ and older may make tax-free distributions to charitable nonprofits directly from their individual retirement accounts (IRAs). Until now, North Carolina residents who made charitable rollovers from their IRAs had to pay state taxes on these charitable contributions. The new law ends this state tax on donations to nonprofits through IRAs, simplifying the process for donors and allowing them to contribute more fully to nonprofits from their IRAs. Donors may begin to use the IRA charitable rollover to reduce their taxes this year.
Thanks For Asking
Denver Wants to Take the Pulse of Nonprofits
 Denver’s Office of Strategic Partnerships wants to know how local nonprofits are faring, and it has issued a Nonprofit Well-Being Survey to find out. The survey asks various questions to gauge nonprofit financial stability, demand for services, and staff. The results from the survey reportedly will be used both to help nonprofits and to inform the Denver Office of Strategic Partnerships Commission on setting priorities and making recommendations to the Mayor. The office also believes the survey will help the City and County of Denver “gain a better understanding of nonprofit organizations that have previously, currently, or would like to contract with the city, and how the city can improve its contracting and funding operations for nonprofits and make nonprofits more empowered.” All we can say is thanks for asking and modeling the way for other governments that partner with nonprofits.
Nonprofits Step Up to Promote Voter Engagement
State associations and other nonprofits stepped up big for Election Day 2019 by encouraging people in their communities to get out and vote. As discussed in the lead State & Local Issues article above, hundreds of seats at the state level, three governorships, and scores of state and local ballot measures were up for grabs. Nonprofits across the country seized the opportunity to advance their missions in nonpartisan ways by promoting civic engagement amongst those they serve through email blasts, candidate forums, questionnaires, and more.
 The CT Community Nonprofit Alliance, the state association of nonprofits in Connecticut, sent out an email on Election Day to all members urging them to get out and vote. The email included a link for recipients to see their individual registration status and polling place, as well as the time the polls were open and accepted types of identification required to vote. The CT Alliance reminded members that Connecticut has same day registration and provided registration locations should individuals still needed to register.
 Likewise, in Massachusetts, the Provider’s Council, one of the state associations in the Commonwealth, and Carevote invited members and staff to join them in voting on Election Day. They put out a complete list of the nearly 60 cities and towns holding local elections. The message stressed: “There are many contested local elections that will impact your community, and it’s important that we vote to support caring communities throughout the Commonwealth.” They alerted readers to check the poll times, which differed by location, and encouraged them to share the email with staff, consumers, and clients, assist client and consumers to get to the polls and fill out absentee ballots, and register online to vote.
The Kentucky Nonprofit Network hosted the two Lieutenant Governor candidates at a luncheon gathering a week before Election Day. The candidates had been sharing public policy priorities affecting nonprofits that they had worked on or affected them individually with various groups, including employment and education issues.
Throughout the election season, the Center for Non-Profits in New Jersey invited candidates to respond online to four questions on their experiences with nonprofits and views on top policy priorities, role of nonprofits advancing their visions for the state, and essential steps to strengthen the ability of nonprofits to meet community needs. The Center posted online all answers to the nonpartisan questionnaire to help nonprofits “gain greater insights regarding how this year’s candidates for New Jersey Legislature view [the] state’s charitable non-profit community, its role in their policy making, and their overall vision for the state.” In releasing the answers, the Center stated it viewed the “questionnaire as one part of a comprehensive advocacy and educational strategy to increase understanding among public officials about the non-profit community and its role in making New Jersey strong, and to foster sound public policies for the people of our state.”
 Other nonprofits dedicated to encouraging get-out-the-vote efforts and civic engagement also pushed out resources and tools to help nonprofits. Nonprofit Vote provided resources such as candidate guides, the Voting Information Project, same day voter registration, and the Election Protection Hotline. Ballot Ready offered a free online tool that allowed users to “create a personalized, interactive ballot based on your voting location that will inform you for the issues and candidate you will be voting on.” The League of Women Voter’s released a Vote 411 tool that provided up-to-date information on polling locations and ballots.
Odd-year elections usually suffer low turnout among voters. Nonprofits like these took it as their civic responsibility to help on a nonpartisan basis to ensure an informed and engaged electorate.
Read more examples of Advocacy in Action,
a regular feature of Nonprofit Advocacy Matters.
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Get Out the Count (GOTC) toolkit
New Jersey Non-Profit Diversity Report
