What We're Tracking in DC
House Ways and Means Committee Hearing on Nonprofits
On Tuesday, the House Committee on Ways and Means held a hearing titled, “Foreign Influence in American Non-profits: Unmasking Threats from Beijing and Beyond.” The hearing was convened as part of the Committee’s investigation into the tax-exempt sector, and whether foreign money, through nonprofit organizations, is being used to influence U.S. policymaking and elections and cause disruption.
Republican members of the committee and some witnesses argued that fiscal sponsorships and donor advised funds (DAFs) lack transparency. They were particularly concerned with foreign nationals using fiscal sponsorships and DAFs to obscure giving to nonprofits that then influenced U.S. politics. There was some bipartisan agreement that modernization and transparency is needed within the IRS. The Council is preparing to submit testimony for the record clarifying misconceptions about the sector.
Expansion of the Mexico City Policy
Last month, the State Department issued three final rules implementing a previously-announced expansion of the Mexico City Policy, all effective February 26, 2026. Originally, the Mexico City Policy prohibited overseas organizations receiving certain U.S. foreign aid from promoting or providing access to abortions.
The expanded policy will now bar a larger set of recipients—including American nonprofits, international organizations, and foreign governments—from receiving almost any foreign financial assistance if they promote or work on certain issues related to diversity, equity, and inclusion or gender-affirming care, in addition to abortion.
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