Public policy news and updates for the philanthropic sector

December 8, 2023

What's Happening This Week...

• Happening at the Council
• What We’re Tracking in D.C.
• Federal Government Engagement Opportunities
• Happening in the States
• News, Resources, and Events

Happening at the Council

Building Together: Leading Collaboratively Across Differences
Building Together is a new immersive learning experience for philanthropic leaders who want to develop strategies and skills to bridge differences and counteract toxic polarization. Join us in Chicago from May 6-9 to be part of this experience.

Registration Open: Foundations on the Hill 
Registration is now open for Foundations on the Hill. This event, taking place from February 25th through February 28th is your opportunity to meet your peers and advocate for the issues that matter to you. Foundations on the Hill is presented by United Philanthropy Forum in partnership with the Council on Foundations and Independent Sector.

What We're Tracking in D.C.

Ways and Means Committee Actions on Nonprofits

• Ways and Means Chairman Jason Smith (R-MO) and Oversight Subcommittee Chairman David Schweikert (R-AZ) announced a hearing next week on exempt organizations’ political activities. This comes after an August Request for Information from the Subcommittee, to which the Council submitted a response detailing existing safeguards on nonprofit political activity.
• The Ways and Means Committee favorably reported H.R.6408 last week. Introduced in November by Rep. David Kustoff (R-TN) and Rep. Brad Schneider (D-IL), H.R.6408 would strip nonprofit organizations of their tax-exempt status if they are found to provide material support or resources to terrorist organizations. While providing support to terrorist organizations is already prohibited, this bill would give the Treasury Secretary new enforcement abilities.

Donor Advised Fund Proposed Regulations
Last month, the Internal Revenue Service (IRS) released proposed regulations on donor advised funds (DAFs). The rules for the first time formally define DAFs, donors, and advisory privileges; explain which funds are not DAFs, including funds making distributions to a single identified organization or grants to individuals (other than for scholarships); and create anti-abuse rules for taxable distributions from DAFs. Watch our explanatory webinar.

The comment period is open until January 16, 2024, but this week, the Council submitted an extension request in hopes of giving the philanthropic sector additional time to respond. Regardless, we plan to submit comments; let us know how these changes would impact you by emailing govt@cof.org.

Council Submits Federal Grants Reform Comments
Earlier this week, we submitted comments to the Office of Management and Budget applauding their proposed update to the Uniform Guidance on federal grant applications and administration. We also requested further streamlining, including urging federal agencies to prioritize multiyear grants and provide upfront payments when possible.

Federal Government Engagement Opportunities

• The Department of Commerce is seeking input on its draft Business Diversity Principles, a set of best practices on equity and economic development. Submit comments before January 5, 2024.
• The Department of the Interior hosted Native Americans in Philanthropy and other leaders from the sector to announce new initiatives to strengthen public-private partnerships aimed at investing in Tribal communities.

Happening in the States

American Rescue Plan Act Funds for Nonprofits
Governments around the country continue to invest their shares of $350 billion in Coronavirus State and Local Fiscal Recovery Funds, most notably in the work of charitable nonprofits. Active funding opportunities have been opened in communities in Maryland, Michigan, and New York, while Oklahoma is receiving applications for its state-wide arts grant program.

States Consider Tax Credits for Childcare
Lawmakers in Illinois and Wisconsin are pushing measures to ease tax burdens on licensed daycare facilities, including those run by charitable nonprofits. Bills in Illinois would exempt the cost of essential supplies from sales and use taxes, plus eliminate property taxes for some. Wisconsin legislation would allow for-profit and nonprofit childcare programs to claim a refundable tax credit up to $100,000 for expenses incurred for starting their program. Read more.

Grants Reform Webinar Recap
On November 20, hundreds of charitable nonprofit leaders participated in a nationwide webinar, The Urgency of Government Grants Reform for Your Nonprofit. Presenters explained the consequences of bad grantmaking policies, such as nonprofit workforce shortages and organizations getting shut out of grants. They also laid out legislative and regulatory solutions that individuals can help influence to ensure reduced burdens, greater access to funding, and better outcomes. View the presentation slides and the recording of the program.

News & Resources

• The Lobbying for Good Movement, Stanford Social Innovation Review
• Is the post-pandemic surge in business dynamism here to stay?, Brookings Institution
• Justice, Equity, and Repair: How Local Governments in the US Are Designing Reparations Programs, Urban Institute

Keep in Touch!

Please feel free to reach out to any of us on the Government Relations Team with comments or concerns, or to share an issue, article, event, or op-ed you would like to see covered in a future Washington Snapshot.

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