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The Sector's Defining Moment
2013 is shaping up to be a defining year for the nonprofit sector, both locally and nationally. The question for us all to consider is: are we going to define ourselves or be defined by elected officials as part of some grand bargain? Wrapped up in Congress' fight to find a politically acceptable balance between revenue and spending are complex urgent issues, including tax reform and our tax exempt status, that go to the core of our identity. And this is on top of the unresolved questions Congress averted as part of the post-election fiscal cliff showdown.
 As I was listening to the President's inaugural address, which shared his vision of a democracy defined by mutual obligations to each other, I was struck by the irony of how nonprofits' work undergirded nearly every aspect of his vision -- and yet we have been absent from much of the public discourse and political rhetoric surrounding fiscal cliff negotiations and upcoming sequestration, and despite the massive impact these decisions will have on nonprofits and those they serve. Locally, nonprofits in Illinois have endured the double punch of doing business in a state that leads the country in lateness of payments, and is near the bottom when it comes to paying the full cost of services provided to the state. At the federal level, nonprofits are likely to absorb the impact of $42.6 billion in across the board cuts from almost every major federally funded domestic program if a full, or partial, sequester takes place on March 1. At the state level, Illinois could lose as much as 8.5% of its total budget due to significant losses of federal revenue for many critical programs providing food to families with children and shelter to the homeless. And the outlook for 2013 at the state level is no better. Unless Illinois Democrats and Republicans can agree on how to fix the state pension mess, all other solutions, like a debt restructuring bill to pay back unpaid bills to providers, are being pushed aside.
More 'Sunshine' on the Horizon As public dollars become more scarce, demonstrating effective stewardship of those dollars grows more important. At the end of the last legislative session, we predicted an increase in the calls for more nonprofit transparency. As this new session begins, here are two new bills we are monitoring for you: - HB2 (Bellock) – Grant Funds Recovery Act: Adds to the list of requirements on a grant application, including demonstrating financial solvency or access to a line of credit; prohibiting conflicts of interest; requiring credentialing of service providers; and setting requirements for reporting outcomes. While we may agree about the need for providers to be financially solvent, proving financial solvency is a difficult task, with no clearly defined best practice or standards and we have concerns that the overall approach of this bill is one that does not honor the state's part in demonstrating mutual accountability. We will be communicating with Rep. Bellock to express our concerns.
- HB943 (Yingling) – FOIA Government Associations: Amends the Freedom of Information Act. Specifies that the term "public body" includes any association of units of local government or any not-for-profit corporation with membership consisting of units of local government. We are reaching out to the legislator in order to better understand the implications for nonprofits proposed by this bill.
Foundations on the Hill: We Need You! While we are beginning to schedule appointments with Illinois lawmakers, we need more participants. During a critical year, our participation at FOTH is at the lowest Donors Forum has seen. If there has ever been a time to educate decision makers on the value and impact of our sector, now is the time.
Back on the Menu: Hearings on the Charitable Deduction As predicted, the fiscal cliff deal signed in January did not signal an end to threats to charitable incentives, including the charitable deduction. Rather, philanthropy's self-defense issues are now part of a larger conversation around tax reform. Congressman Dave Camp (R-MI), Chairman of the Committee on Ways and Means, announced that the Committee will hold a hearing to examine the itemized deduction for charitable contributions as part of the Committee's work on comprehensive tax reform. The hearing will take place on Thurs., Feb. 14, in Room 1100 of the Longworth House Office Building, beginning at 9:30 am. Congressman Danny Davis (D-07), member of the Committee on Ways and Means, has reached out and wants to ensure the nonprofit and philanthropic sector in Illinois is aware that -- unlike traditional hearings that have invited witnesses -- any individual or organization interested in providing oral testimony at this hearing with respect to the charitable deduction should contact the Committee's tax office to discuss the possibility of receiving an invitation, pursuant to the procedures outlined in the hearing notice (see "Details for Submission of Request to Be Heard"). In addition, anyone not scheduled to give oral testimony may submit a written statement for consideration by the Committee and for inclusion in the printed record of the hearing. How to request participation: Requests to be heard at the hearing must be made to the Committee on Ways and Means either by telephone at 202-225-5522 or by email at tax.reform@mail.house.gov. Please include the phrase "charitable deduction" in the subject line of the message and submit the request no later than the close of business, Thurs., Feb. 7. The request should include a brief summary or outline of the proposed testimony. How to submit written testimony: Follow this link on the hearing page of the Committee website and complete the informational forms. From the Committee homepage, http://waysandmeans.house.gov, select "Hearings." Select the hearing for which you would like to submit, and select "Click here to provide a submission for the record." Once you have followed the online instructions, submit all requested information. Deadline: by the close of business on Thurs., Feb. 28. Donors Forum will be submitting written testimony and also participating in Congressman Davis' listening session on charitable incentives at the Field Museum on Mon., Feb. 11. | |
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