Washington Snapshot - July 31, 2015
Council Releases August Advocacy Toolkit
This Tuesday, the Council hosted our Washington Update LIVE! webinar to discuss the importance of building relationships with your lawmakers so that they understand the value of philanthropy in their districts and states. Featured speakers: Maggie Gunther Osborn of the Connecticut Council for Philanthropy, David Thompson of the National Council of Nonprofits, and Lisa Danielson of L. Danielson Consulting, shared their insights and experiences on how to successfully engage with Members of Congress and ensure that your message resonates. The speakers focused on how you can use the August recess—starting today—as an ideal opportunity to start building relationships with both lawmakers and local district staff.
Also highlighted during this webinar was the newly released edition of our Advocacy Toolkit. The Toolkit is a resource that is meant to provide guidance and strategy for connecting with your lawmakers during the August recess when they are back home in their districts. The Advocacy Toolkit features:
- Talking points for meetings with lawmakers
- Template op-eds for placement in your local newspapers
- Guidelines on the rules of advocacy and lobbying for different types of foundations
- Frequently asked questions you might get from lawmakers and staff, and suggested answers
And much more!
To watch a recording of this webinar or view the slides that were used, please click here. For more information or to learn how the Council can help you engage with your lawmakers, please contact Serena Jezior.
News from the Hill
Action on "Tax Extenders" Not Likely Until Fall
Though there had been some discussion of attaching “tax extenders” to Highway Trust Fund legislation, yesterday the Senate approved a temporary, three-month fix for transportation funding without including extenders—postponing any further action to renew these provisions until after the August recess.
As our readers will recall, included as part of this extenders package are three charitable provisions that were included in the America Gives More Act of 2015 (H.R. 644): the IRA charitable rollover, and enhanced deductions for contributions of land conservation easements and food inventory.
Back in May, the Senate advanced trade bills by replacing the language of H.R. 644 with trade provisions. Despite this setback, champions in the House and Senate are still very committed to passing these charitable provisions as quickly as possible. The Senate Finance Committee marked up a tax extenders package last week that included a version of these charitable tax extender provisions.
The Council, along with colleagues including Independent Sector and National Council of Nonprofits, will continue to urge Congress to enact these provisions into law so that taxpayers and nonprofits alike can benefit from the IRA charitable rollover as soon as possible.
Executive & Regulatory News
Nonprofit Leaders Requesting Extension for Comments on DOL Proposal
As our readers will recall, earlier this month the Department of Labor (DOL) announced a proposed change to the regulations issued under the Fair Labor Standards Act (FLSA) that would, ultimately, make more nonprofit employees eligible for overtime compensation. An article in Nonprofit Quarterly this week did a great job laying out the potential implications of this rule change.
The Council has signed onto a sector-wide letter with Independent Sector and other colleagues in the field, requesting a 60-day extension to the comment period for this proposal—currently set to end on September 4th. If your organization is interested in signing on to this letter, click here.
Trending in Legal Affairs
Establishing a DAF with Defunct Political Campaign Contributions
Recently, the Council’s Legal Affairs Team was contacted by a community foundation about establishing a donor advised fund (DAF). The prospective donor—a retired state legislator—wished to direct all remaining dollars in his political fund to create a DAF at his local community foundation.
The community foundation, uncertain of federal restrictions on the use of political funds, reached out to the Council for guidance on this proposed donation.
Under § 30114(b)(1) of Federal Campaign Finance laws, campaign funds are prohibited from being expensed for “personal use.” The regulations define “personal use” as any use of funds in a campaign account of a present or former candidate to fulfill a “commitment, obligation or expense” of any person that would exist irrespective of the candidate’s campaign or duties as a Federal officeholder.
The campaign finance regulations make clear, however, that donating the funds to charity is not considered “personal use,” so long as the candidate does not receive any personal compensation, beyond an incidental benefit, from the charitable organization. The Legal Team advised that the political funds may be used to establish the donor advised fund with the community foundation.
For more information on this or any other tricky legal matters, please contact the Council’s Legal Affairs team at legal@cof.org.
Access to the Council’s legal team is a valuable member benefit. Council attorneys are available to discuss your legal questions and to provide legal information by telephone, email and through our various publications and newsletters. This information is intended for educational purposes and does not create an attorney-client relationship. The information is not a substitute for expert legal, tax or other professional advice tailored to your specific circumstances, and may not be relied upon for the purposes of avoiding any penalties that may be imposed under the Internal Revenue Code.
Happening in the States
Exclusive from our colleagues at the National Council of Nonprofits.
Judges, Tax Assessors Re-Imagining Tax Exemptions
A decision in New York to impose retroactive property tax liability on a charitable nonprofit is only the latest instance in a growing trend involving non-legislative officials reconsidering, and even rewriting, the longstanding rationale for property tax exemptions.
Recently, the New York Court of Appeals upheld a decision by the New York City tax commission that a parking lot owned by the Greater Jamaica Development Corporation was a commercial enterprise and not sufficiently related to the nonprofit’s charitable mission, a decision that will result in taxes for the five years since the nonprofit took over the operations of the facility from the city. The new decision reportedly upends precedent dating back to the time when the Koch Administration sought to tax the property of private foundations, cultural institutions, and universities.
The New York case follows a decision in June by a New Jersey judge who partially revoked the property tax exemption of a major nonprofit hospital chain and separately allowed a case to proceed challenging the tax-exempt status of Princeton University.
In addition to judges, recent reports from Florida, Michigan, New York, and elsewhere suggest that tax assessors in various communities have become more aggressive in challenging the longstanding property tax exemption of nonprofits.
Philanthropy News and Op-Eds
Mission-Driven Advocacy by Nonprofit Boards
In a similar spirit of advocacy, our colleagues at the National Council of Nonprofits featured a story in their e-Newsletter, Nonprofit Advocacy Matters, this week about the Stand For Your Mission campaign. The intent of this initiative is to engage nonprofit board members in advocacy to advance their charitable mission as a fundamental responsibility and function of the board.
The idea of building relationships with lawmakers is a central theme for both this campaign as well as the Council’s Advocacy Toolkit. A favorite quote from David Thompson, Vice President of Public Policy at the National Council of Nonprofits, which he shares highlighting the importance of advocacy is, “you don’t want to have to ask a stranger for a favor, so get on up there [to connect with lawmakers and other stakeholders] and make some friends.”
The Role of Philanthropy in a Governmental Society
A recent article in Governing magazine points out the nuanced differences between philanthropy’s ability versus government’s ability to address the issues that affect our society. It highlights one common misconception of philanthropy by many—that philanthropy can substitute for the role of government in funding systemic issues.
As Hilary Pennington from the Ford Foundation rightly points out, this is simply not the case. Foundations can certainly fund experimental solutions on a limited scale, but “the path to scale is through the government,” she states.
Aligned with this, Pennington urges philanthropy, and foundations in particular, to pay more attention to working with social entrepreneurs within government as a means to implementing long-term solutions to scale.
