Federal Legislative Activity

We have restructured our public policy section to show issues by topic. Visit our index here.

Other Federal Issues

Bankruptcy Protection to allow for Charitable Donations (2006)

Bush Order Limits Agencies “Guidance” (2007)

Combined Federal Campaign (2006)
Do Charities Serve Diverse Communities? (2007)

Healthcare Issues (2009)
Independent Sector (IS) Announces Value of Volunteer Work for 2006 (2007)

National Council of Nonprofit Associations- Blueprint for Action (2005)

New Postal Move Update Standard Could Cost Nonprofits

New Study Proves Importance of Community and Private Foundations (2008)
Nonprofit Capacity Building Fund (2010)

Nonprofits Eligible for Payroll Tax Forgiveness for Hiring Unemployed Workers (2009)

Postal Rate Increase Announced (2007)

Nonprofit “Shovel-Ready” Projects: Pennsylvania Data from Johns Hopkins University Listening Post Project  (2009)
RESULTS ARE IN ON NONPROFIT SHOVEL READY PROJECTS: $8.4 billion in PA nonprofit projects on hold  (2009)

Strengthening Communities Fund (2010)

Student Loan Forgiveness for Nonprofit Employees (2007)

Urge Congress to Approve IRA Rollover Provision 

US Senate Finance Committee to Mark–Up Health Care Reform Bill (2009)

3/18/10 Nonprofits Eligible for Payroll Tax Forgiveness for Hiring Unemployed Workers. Earlier today President Obama signed into law the Hiring Incentives to Restore Employment Act (HIRE Act) that, among other things, includes temporary tax incentives to encourage employers to hire new workers. The new law allows nonprofits and other employers to keep the 6.2 percent payroll taxes on certain new hires. The incentive is only available for a short time and it applies to only certain newly hired workers. Go here for more information.

 This payroll tax forgiveness provision expires at the end of the year, so you will save more the sooner you hire eligible unemployed workers.

3/25/09 Forward Together: Empowering America’s Citizen Sector for the Change We Need. John Hopkins University’s Listening Post Project, created a policy agenda, “Forward Together”: Empowering America’s Citizen Sector for the Change We Need, to strengthen America’s nonprofit sector. The declaration calls “for a reinvigorated and empowered partnership between government and the nonprofit or “citizen sector”.

Forward Together calls on government, business and nonprofits to join together to solve the problems facing the country. With an improved partnership together all sectors can undertake solving our nation’s social challenges.

The declaration underscores the nonprofit sector’s economic contributions and unique qualifications but acknowledges that nonprofits need government’s assistance to have a role in unraveling the problems our country is facing.

Hundreds of nonprofit organizations across the county have signed onto Forward Together including National Council of Nonprofits, Common Cause, Girl Scouts of the USA, United Way of America, and state nonprofit associations from Hawaii to Maine. For more information and to sign onto the Forward Together please visit http://www.jhu.edu/listeningpost/forward/.

12/3/08 New Study Proves Importance of Community and Private Foundations. At the National Press Club this morning, The Philanthropic Collaborative (TPC) announced the launch of its new web site www.philanthropycollaborative.org and released a groundbreaking new study that demonstrates the economic value of private and community foundations.  Dr. Robert Shapiro’s Report measured the social and economic benefit generated by the work of private and community foundations in 2007.  The study finds that on average, each dollar provided through grantmaking by a private or community foundation produced a return of $8.58 in direct, economic and social welfare benefits.  Given the current economic environment, the study sends a clear message to policymakers that this much-needed funding source should not be taxed or restricted. Read today’s Wall Street Journal article.

10/22/07 New Postal Move Update Standard Could Cost Nonprofits. In an effort to reduce the cost of undeliverable mail, the US Postal Service has issued new standards requiring mailers to update their mailing lists every 95 days to account for recipients who have moved.  A mailing entered on Nov. 23 for example, must bear addresses that were updated no earlier than Aug. 20.  The new rules will take effect on Nov. 23.  Nonprofits that fail to update the addresses that they mail to (within 95 days) and verify it with a Certificate of Move Update Compliance (PS Form 6014) may be charged first class rates for their mailing.   Five authorized methods to qualify for the Move Update standards are posted online at http://www.usps.com/mailpro/2008/mayjune/page5.htm 

Do Charities Serve Diverse Communities?

9/25/07 US House W&M Hearing Asks “Do Charities Serve Diverse Communities?” On September 25, the US House Ways and Means Oversight Subcommittee held a hearing examining whether tax-exempt charitable organizations adequately serve the needs of diverse communities. Oversight Subcommittee Chairman John Lewis (D-GA) asked the hard questions “how well do charities serve the needs of our diverse communities?” and “how can we serve their needs better?” While one witness from the Urban Institute demonstrated statistically that people of every economic, racial, and ethnic group give and volunteer to nonprofit organizations, an additional witness spoke about the mismatch between philanthropy and need.
House Ways and Means Hearings   
Chronicle of Philanthropy Article

Student Loan Forgiveness

9/28/07 President Signs College Cost Reduction and Access Act; Nonprofit Employees Get Student Loan Relief. The President Signed the largest investment in higher education since the GI Bill today, the College Cost Reduction and Access Act will apply to 501(c)(3) nonprofit employees.  Charity employees are eligible for college loan balance forgiveness after 10 years of payments under an income contingent repayment plan.  Many restricts will likely apply, but this is a major investment in affordable education for both the public sector and the nonprofit sector.  H.R.2669 is now Public Law No: 110-84.  

Summary of the bill from the US House Committee on Education and Labor
Summary of the bill as it passed the Senate amended (7/20/2007)

9/11/07 Congress Passes Student Loan Bill with Debt Relief to Nonprofit Employees. The Senate passed legislation that would cut over $20 billion in federal subsidies to institutions that create student loans in order to increase financial aid to college students. In the largest investment in higher education since the GI Bill, the College Cost Reduction and Access Act (H.R. 2669) offers Student Loan Debt Relief to nonprofit employees. On September 7, both houses of Congress approved the conference committee report for H.R. 2669 that would include employees of 501(c)(3) organizations as 'public sector' employees for purposes of a new loan forgiveness provision. The legislation includes workers for 501(c)(3) tax exempt organizations as a 'public sector job' making the individual eligible for loan balance forgiveness after 10 years of payments under an income contingent repayment plan. The bill also provides interest rate reductions on subsidized student loans, caps on required repayments based on available discretionary income, and - increasing Pell Grants in amount and broadening eligibility. The President is expected to sign the bill. 
Conference Committee Report
For the summary of the bill that passed the House on July 17, 2007- (the latest summary available) 

7/23/07 House Bill Offers Student Loan Forgiveness for Nonprofit Employees. The College Cost Reduction Act of 2007 (HR 2669) is making its way through Congress right now. The bill may need a push from us to ensure that employees of 501(c)(3) organizations can take advantage of a provision geared towards supporting students in loan repayment. Further information is below.

Under current law, “income contingent” repayment plans are available to anyone having trouble repaying student loans. The individuals need only opt to pay back student loans based on an affordable percentage of their salary. Unpaid amounts are to be forgiven after 25 years.

The House version of HR 2669 would allow the individual to repay student loans based on an affordable percentage of their salary, but forgive unpaid amounts after 10 years if working for an eligible employer. Eligible employers include federal and state government, specific social and emergency services, 501c3 organizations, and others. HR 2669 passed the House on July 11 by a 273-149 margin.

The Senate version of HR 2669 is similar to the House version but does not include the 501(c)(3) provision. Some 501(c)(3) organizations may be included through other categories such as social and emergency services, but most 501(C)(3)’s are not considered eligible employers. HR 2669 passed the Senate July 20 by a 78-18 margin.

Both versions of HR 2669 were referred to conference Committee to reconcile the House and Senate differences. A conference report is expected before the August recess. It is uncertain whether the 501(c)(3) provision (as appears in the House version) will remain in the final bill.

As the costs of a college education continues to rise, nonprofit sector wages fail to keep pace with for-profit sector wages, young people are being driven away from the nonprofit sector. For so many young people saddled with student loan debt, it is becoming increasingly difficult to seriously consider jobs with nonprofits, especially smaller local organizations that typically offer lower salaries. According to a recent survey, over two-thirds of Philadelphia’s Nonprofit Executive Directors plan to leave their positions within the next three years 2010.

By extending loan forgiveness to 501(c)(3)’s HB2669 would make a career in nonprofits a feasible and attractive option for many of Pennsylvania’s best and brightest.

Please contact your Member of Congress and urge the Conference Committee to preserve the House 501(c)(3) provision in HR2669. It is essential that the final version of this bill includes student loan forgiveness for charitable nonprofit organizations.

4/4/07 Independent Sector (IS) Announces Value of Volunteer Work for 2006. IS has just released their calculation for 2006 estimating the value of a volunteer work at $18.77 per hour. Many organizations find this estimate helpful in quantifying the enormous value volunteers provide. For more information, go to http://www.independentsector.org/media/20070330_Volunteer.html.

3/30/07 Postal Rate Increase Announced. The USPS issues final rule and announced a postal rate increases. The New standards for domestic mailing services final rule (POSTAL SERVICE 39 CFR Part 111) is an attempt by the USPS to recognize the impact on costs of different shapes, and try to maximize economic efficiency within the mailing industry. The new rates are effective as of May 14. For a copy of the rates, go to http://www.usps.com/ratecase/. 

1/18/07 Bush Order Limits Agencies “Guidance.” President Bush issued an executive order sharply curtailing the power of agencies to regulate industry through issuance of "guidance". Guidance is the informal advice provided by Federal Agencies clarifying the regulations. Federal Agencies issue guidance to interpret key policy and technical questions, often at the request of industry. Guidance is not an official rule and is not legally binding. However, businesses including charities, pay close attention to it.

While some argue that this is a power grab by the president, others argue that the use of guidance has gotten out-of-hand and should be subject to oversight by the OMB. The Labor Department's Occupational Safety and Health Administration, for example, issued 574 guidance documents between 2001 and 2005, many directed at the construction industry.

The order requires agencies to state in writing "the specific market failure" that the new rule intends to cure, to project the cost of a new rule; to request and receive prior approval by the White House Budget Office for any new rule with economic impact of over $100 million, and to make such rule available for public comment.

OMB Watch has more information about this here: http://www.ombwatch.org/article/articleview/3685/1/132?TopicID=3.  President Bush’s Executive Order is here: http://www.whitehouse.gov/news/releases/2007/01/20070118.html.

1/17/07 US House Ways and Means Committee to hold January 23 hearing on how US economic growth has resulted in income inequality, and low wages. New House Ways and Means Committee Chairman, Charles Rangel (D-NY) announced Tuesday that the Committee will hold the first in a series of hearings on the economic condition of the U.S. economy. The hearings will examine the current state of the economy, the cost of poverty on the American economy, the impact of globalization on American workers, economic pressures on the middle class, and whether all Americans have shared in the benefits of the economic recovery since the last recession. For more information go to House Ways & Means Committee at http://waysandmeans.house.gov/hearings.asp?formmode=view&id=5387. 

10/11/06 U.S. House May Consider Bill Protecting Charitable Donations from Bankruptcy. The House is expected to consider S. 4044 a bill to allow individuals in bankruptcy to give to charities and churches even though they are bankrupt. The Senate passed S. 4044 in September. The bill is designed to correct problems caused by the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005. Courts have interpreted the language in this Act to prohibit individuals in bankruptcy who have incomes above the median level to continue to give to charities or tithe to churches while they are in bankruptcy.

10/11/06 OMB Watch Launches Online Federal Spending Database. OMB Watch launches much anticipated online database allowing you to search, aggregate and analyze all federal spending, (www.FedSpending.org). The data comes from the Federal Procurement Data System (FPDS), which contains information about federal contracts; and the Federal Assistance Award Data System (FAADS), which contains information about federal financial assistance such as grants, loans, insurance, and direct subsidies like Social Security. We encourage you to explore this data and to use this data to hold elected leaders and government agencies accountable for their policy choices and their actions. For more information go to http://www.ombwatch.org/article/articleview/3608/1/2?TopicID=. 

Simultaneously, President Bush recently signed into law the Federal Funding Accountability and Transparency Act (S. 2590). This new law requires the Office of Management and Budget to create and maintain a searchable public database disclosing all federal grants, loans, and government contracts. The government website will not be online until January 2008.

The differences between the two websites, OMBWatch’s website (www.FedSpending.org)  and the government website (www.expectmore.gov), are numerous. The government database will broaden the scope of information to cover all federal spending, while FedSpending.org is limited to the FPDS and FAADS databases. The government database is required by law to post updated information within 30 days after being assigned the information, while FedSpending.org will only be updated every six months. The government database will also be expanded by 2009 to include subcontract and subgrants.

CFC

3/14/07 Office of Personnel Management Lifts CFC Cap on Fundraising Overhead. The Office of Personnel Management (OPM) lifts overhead spending restrictions on fundraising in the Combined Federal Campaign (CFC). The OPM which administers the charity drive, dropped the requirement that charities spend no more than 25 percent of their revenue on fundraising and other overhead expenses.

In a March 12 news release, OPM Director Linda M. Springer, offers assurances that the CFC remains a program that federal employees can support with confidence, and that each participating charity must meet stringent eligibility and public accountability requirements. While she acknowledges concerns about the elimination of the 25 percent administrative and fundraising rate (AFR) requirement to participate, she notes that numerous organizations in prior years have participated in the CFC with AFRs in excess of 25 percent. Those organizations provided an accepted explanation and a plan to reduce their AFR. For a copy of the OPM news release go to http://www.opm.gov/news/opm-director-linda-m-springers-statement-on-the-combined-federal-campaign-cfc,1157.aspx. 

Senate Finance Committee Ranking Member Charles E. Grassley (R-Iowa) opposes the CFC rule change, and may actively oppose it by discouraging federal employees from giving. For Senator Grassley’s March 12 news release go to http://finance.senate.gov/press/Gpress/2007/prg031207.pdf. 

12/13/06 CFC Removes Anti-Advocacy Requirements from Qualification Regulations. This week, the Combined Federal Campaign (CFC) announced that it will remove anti-advocacy requirements from their qualification regulations. Previously, to be eligible to receive donations through the CFC, organizations applying to participate were required to certify that "the organization has no expenses connected with lobbying and attempts to influence voting or legislation at the local, state, or federal level, or, alternatively, that those expenses would classify the organization under U.S.C. 501(h)." Thanks in part to the work of the Alliance for Justice, the regulations have been changed to remove lobbying restrictions. Copy of the new regulations.

National Council of Nonprofits

PANO is a member of the National Council of Nonprofits. For other updates, visit their public policy website.