Policy Update & Call to Action

Policy Update & Call to Action: Inform Our State's Senators, Charitable Giving Incentives Matter to Nonprofits      On June 27, Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Orrin Hatch (R-UT) sent a  letter informing senators that the Committee will start consideration of a tax reform package with a "blank slate," meaning that it contains no deductions or credits, so Senators will have to fight to get their favored tax provisions re-inserted into the bill that is being drafted. The Committee leaders stressed that the legislation they are drafting on a bi-partisan basis will restore only those deductions, exclusions, credits, and other tax expenditures that: Help grow the economy Make tax laws fairer Effectively promote other policy objectives They've asked Senators to submit recommendations for provisions that meet these standards by July 26.    We are hearing that Senators are responding to the request for input with mixed views. Some may be submitting a list of priority tax provisions; others will likely provide a set of guiding principles for the Committee to follow; and still others apparently are refusing to send in anything out of fear that their submission will be made public. Virtually every lobbyist and interest group is clamoring for the attention of Finance Committee leaders, members, and staff. Some efforts to get their attention include submitting a sign-on letter and sending letters making the case for tax provision that affect their operations. NYCON has also taken steps in writing a letter to submit to the Senate Finance Committee for this "Blank Slate." We encourage members and nonprofits statewide to write your own letters to inform the Senate Finance Committee. Please feel free to use our letter as a template to model your own or weigh in as constituentsabout your work and the importance of the charitable giving incentive to your ability to solve problems in their communities share your stories with the National Council of Nonprofits Your stories will help us make clear to federal policy makers that the charitable giving incentive is unique from other tax deductions and credits and must be preserved in tax reform As always, thank you for your continued involvement with NYCON and for the tremendous work you are doing to make our communities strong and vibrant places to live and work. We truly appreciate your dedication and commitment. If you have any questions about this or any other public policy issue, please feel free to contact me. We look forward to working with you on these important issues.              Sincerely,               Doug Sauer, CEO             New York Council of Nonprofits, Inc.    The Charitable Giving Incentive   Federal tax law currently encourages individuals to give to charitable organizations whose missions they support by providing an itemized deduction. Policymakers in Washington are focusing on how to reduce the federal budget deficit through spending cuts, entitlement reforms, and changes to the tax code. The President, Senators, Representatives, bi-partisan commissions, and think tanks have all put forward plans to address these issues, and many propose changing the charitable giving incentive in one way or another. No one knows the true impact that any of these proposals will have on the ability of charitable nonprofits to raise the resources needed to provide the programs and services that fulfill their missions. It is imperative that Congress make no changes to the charitable deduction that threatens the ability of nonprofit organizations to serve those most in need and to continue to strengthen our communities. Proud Member of  the National Council of Nonprofits

National Council of Nonprofits: Nonprofit Advocacy Matters

Federal Tax Reform Invitation Draws Mixed Responses from Senators The first deadline for influencing comprehensive tax reform is looming and Senators are reportedly mixed in their views of how to respond. On June 27, Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Orrin Hatch (R-UT) sent a letter informing Senators that the Committee will start consideration of a tax reform package with a "blank slate," meaning that it contains no deductions or credits. As a result, Senators will have to fight to get their favored tax provisions re-inserted into the bill that is being drafted. The Committee leaders stressed that the legislation they are drafting on a bi-partisan basis will restore only those deductions, exclusions, credits, and other tax expenditures that (1) help grow the economy, (2) make tax laws fairer, and (3) effectively promote other policy objectives. Some Senators may be submitting a list of priority tax provisions; others have indicated they are likely to provide a set of guiding principles for the Committee to follow; and still others apparently are refusing to send in anything out of concern that their submission will be made public. Predictably, lobbyists and interest groups are submitting multipoint proposals to lawmakers seeking to make the case for their own special tax breaks. Unless nonprofits speak up, their concerns for those they serve will get ignored. Individual charitable nonprofits have the opportunity to weigh in as constituents to inform their Senators about their work and the importance of the charitable giving incentive to their ability to solve problems in their communities. Help protect charitable giving incentives by sharing your story. Impact of Sequestration: Myth or Reality? The answer to whether the severe negative consequences of the across-the-board budget cuts known as sequestration have been overblown or are real depends on who is answering. A recent Washington Post article suggested that the cuts have not been as dire as predicted, asserting that Congress and federal agencies have taken mitigating actions to prevent “widespread breakdowns in crucial government services.” The focus of that article and some federal policymakers, however, has been primarily on federal staffing and direct government services, and many have failed to recognize the severity of the arbitrary cuts on individuals and communities outside the Beltway. For instance, in the last week alone, Head Start program operators in Napa and Solano, California have begun partially or completely closingsix classrooms, the Northwest Arkansas Economic Development District acknowledged that it must cut 12,400 meals for homebound seniors, and TOUCH, a nonprofit in Congers, New York dedicated to helping people with chronic illnesses, is owed $120,000 from the federal government andmay have to begin cutting programs. Share stories of cuts to your nonprofit and the effects on people in your community andread others, from every state, at GiveVoice.org. These stories will help policymakers understand the costs of sequestration as major decisions approach about appropriations, the continuing resolution, and whether to continue these arbitrary cuts.  Additional Federal Story Charities Express Opposition to Changes to Federal Fundraising Campaign States Consider Nonprofit Giving Incentives and Tax Exemptions as Sessions End State treatment of the charitable giving incentive and tax exemptions are at the center of tax reform debates across the country as legislatures rush to complete action before the end of their legislative sessions. On July 2, Hawai’i Governor Abercrombie signed legislation that exempts the State’s charitable deduction from the overall cap on itemized deductions. North Carolina made similar progress in exempting the charitable deduction from changes when the Senate approved an amendedtax reform plan with several improvements for nonprofits. Although the plan retains provisions that cap sales tax refunds for some nonprofits, require nonprofit arts groups to charge sales tax on admission, and eliminate the non-itemizer credit for charitable contributions, the bill carves out the charitable giving incentive from a $15,000 cap on other itemized deductions. Prior to adjourning, the Oregon Senate failed to pass a budget and tax bill, an earlier version of which would have capped all itemized deductions except for charitable donations. Oregon’s Governor may call a special session of the Legislature in September to continue consideration of the budget and tax bill. Bucking the trend in support of the work of charitable nonprofits, Maine policymakers enacted a FY 2014-2015 biennial budget that, among other things, caps all itemized deductions, including the charitable giving incentive, at $27,500 retroactive to January 1, 2013.  Rhode Island Legislature Mandates “Voluntary” Agreement, or Else! Rhode Island Governor Chafee signed legislation that allows the City of Smithfield to charge Bryant University for public-safety service fees if the University fails to reach an agreement for expanded payments in lieu of taxes. Bryant is considering litigation to block the new law that only applies to the university, on the grounds that it is unconstitutional, unwarranted, and needlessly divisive. University officials said in a statement that it contributes more than $800,000 annually to the City in addition to already paying for fire, police, and rescue services through existing PILOT agreements. "This heavy-handed legislation comes after several months of good-faith discussions with the town of Smithfield and is not in the best interests of any of the parties involved," the University said. Other Taxes, Fees, PILOTs Stories Tax Exemption Preserved in NJ Street Maintenance Fees in TX Government-Nonprofit Contracting News New York’s Executive Order 38 Survives First Challenge New York Governor Cuomo and the State Department of Health were within their authority to establish caps on executive compensation and limit the amount of administrative costs that can be paid using government funds, a court recently ruled. Concerned Home Care Providers, Inc. sought a preliminary injunction to prevent Executive Order 38 from taking effect on July 1, 2013. Regulations implementing the Executive Order, which applies to all state agencies making authorized payments to service providers, limits total compensation to executives of covered nonprofit and for-profit organizations to no more than $199,000 per year, among other criteria. The regulations limit not only how much can be paid for executive compensation using government funds, but all funds. Administrative costs are also capped for contractors at a declining rate until April 1, 2015, at which point they must not exceed 15 percent. Government Innovation: Collaboration with Nonprofits Denver’s Office of Strategic Partnerships (DOSP) is the subject of praise in a recent article about creating a culture of innovation in government. The Office has been building collaborative efforts between government and nonprofits in the city, including a recent overhaul of the current contracting system to alleviate cumbersome, confusing, and inconsistent contracting practices to create streamlined, consistent practices across City departments with a focus on outcomes. DOSP is headed by Dace West, a member of the new National Government-Nonprofit Contracting Reform Task Force that the National Council of Nonprofits established to bring together national experts to identify and promote proven solutions across the United States that streamline contracting policies, improve outcomes, and save taxpayers money, all while maintaining or even increasing accountability. Additional State and Local Stories New York's Nonprofit-Managed Parks Worry about Funding Disparities Cuts to Buffalo School Music Programs Countered by National Nonprofits Demonstrating Nonprofit Social and Economic Impact The YMCA of Greater New York knows how important it is to measure its impact for funders and the public; it has moved beyond simply assessing the effectiveness of its programs to also calculating its economic impact on Greater New York.   Among the findings made in a new study, the YMCA announced that it employs the full-time equivalent of 3,240 New Yorkers, pays more than $113 million annually in wages, and contributes more than $191 million annually to the city's economy. The study also found that the Y supported the business community, because 1,800 parents in need of childcare were able to go to work because of the YMCA's after-school program. The YMCA reports that its decision to measure the organization’s economic impact on its surrounding community is intended to augment its other program-based metrics, such as the measure of students’ math and reading improvements after they participate in YMCA classes. “Our ultimate goal is to improve people's quality of life," Jack Lund, Greater New York City CEO, said. "And with this study we are showing that we are." See more on how the New York City Y tracks its benefit to the community. Federal Issues Tax Reform Sequestration Spotlight Federal Workforce Giving State Issues Charitable Giving Incentives: HI, ME, NC, OR Taxes, Fees, PILOTs: NJ, RI, TX Government-Nonprofit Contracting: CO, NY Parks Funding: NY Music Funding: NY Advocacy in Action ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦ ♦  Nonprofit VOTE Webinar Laws on the Ballot: Ballot Measure Advocacy for Nonprofits July 25 at 2:00 pm Eastern Learn about the important lawful roles that nonprofits can play in ballot measure elections.Register now. Free Webinar Health Insurance under the Affordable Care Act Does your nonprofit have the information it needs to make decisions about providing health insurance for your employees under the new Affordable Care Act? Can your nonprofit answer your employees' questions about health insurance? Join the webinar What Small Nonprofits Need to Know about Health Insurance under the Affordable Care Act on July 30 at 3:30 p.m. Guest speakers from the federal government will explain how implementation of health care reform will impact small nonprofits. Register now. This webinar is available free to all nonprofits thanks to the generous support of ReadyTalk. Affordable Care Act Resources The National Council of Nonprofits has updated our website resources: FAQs for small nonprofit employers Guidance about key provisions of the ACA Worth Reading “Cities and Symphonies: Will the Music Stop?,” Tod Newcombe,Governing, July 5, 2013, reporting on how the financial struggles of orchestras, large and small, are bad for cities, and providing keen insights into the positive impact of the arts on local economies and well-being. “Why the Federal Budget Crisis Won't be Solved in Washington,” Mark Funkhouser, Governing, July 1, 2013, making the case for solutions at the local and state levels to fix federal budget problems. © Copyright 2013 National Council of Nonprofits. All rights reserved  1200 New York Avenue, NW | Suite 700 | Washington, DC 20005 | www.councilofnonprofits.org

N.Y. cities seek revenue sources other than property taxes

ALBANY — If Syracuse raises property taxes 1 percent, the city would get about $300,000 in revenue. Its pension bill is rising by $15 million next year.

If the city of Rochester raised property taxes to its constitutional limit, it would bring in $32 million in additional revenue. That would only be enough to cover the city’s budget deficit for next year.

While much of the focus of upstate cities’ financial problems have been on rising costs for pensions and health care, they are dealing with just as many problems on the revenue side of their ledgers.

“There has been a fundamental change in these places,” Rochester Mayor Thomas Richards said. “That fundamental change means that we just can no longer generate enough revenue to pay our expenses.”

Property taxes and state aid are cities’ main revenue sources. But a dwindling manufacturing sector, a glut of vacant properties and growing poverty have made property taxes a less reliable foundation for their budgets.

“Either with abandoned properties or tax-exempt properties, you can get just so much out of the folks who are still able to pay taxes,” Comptroller Thomas DiNapoli said.

Yonkers, which has property values four times higher than the average of other upstate New York cities, has also struggled with revenue. Property values declined 24 percent from 2008 to 2011 in Yonkers, a report Tuesday from DiNapoli found.

Yonkers Mayor Mike Spano said last month that the city’s sales-tax revenue has increased in recent years, and there is some positive economic development. But it hasn’t made up for growing costs. He wants a state task force to look at cities’ problems.

“We still need to address the core issues that are facing cities,” he said after a budget hearing in Albany. “They will not be able to tax their way, cut their way nor borrow their way out of their issues. There needs to be a new matrix put in place.”

Last month, Moody’s Investors Services downgraded Binghamton’s credit rating and said it could take further steps against the city, citing its fiscal woes and diminishing tax base.

Comptroller Thomas P. DiNapoli's Weekly News

Comptroller Thomas P. DiNapoli's Weekly News

DiNapoli: Municipalities Should Ensure Background Checks For Youth Program Workers

Local governments could do more to conduct background checks on individuals working in municipal youth program services, according to an audit released Friday by New York State Comptroller Thomas P. DiNapoli.

DiNapoli Approves Terms of $3.14 Billion Tappan Zee Bridge Contract

State Comptroller Thomas P. DiNapoli last Friday announced he has approved a $3.14 billion contract between the state Thruway Authority and Tappan Zee Constructors to design and build the new Tappan Zee bridge.

Officers of Albany Nanotech Complex Safeguarding Public Funds

Fuller Road Management Corp., the not for profit corporation that runs the State University at Albany’s College of Nanoscale Science and Engineering, is fulfilling its duties to support and provide appropriate internal controls over operations and activities, and promoted an ethical business climate at the multi–billion dollar facility, according to a report released Friday by State Comptroller Thomas P. DiNapoli.

DiNapoli: State Tax Revenues Up, But Still Lag Projections

Tax collections through December totaling $46.4 billion were $48.3 million below the state’s latest estimates and $685.3 million below initial estimates in April. Higher than anticipated personal income tax collections in December likely reflect income paid before federal tax increases take effect in 2013 for high income taxpayers, New York State Comptroller Thomas P. DiNapoli said last week in releasing the December cash report.

Comptroller DiNapoli Releases Municipal Audits

New York State Comptroller Thomas P. DiNapoli Thursday announced his office completed audits of:
the City of Beacon; the Midway Fire District; the Niagara Falls Housing Authority; the Orleans County; the Town of Otto; and, the Village of Spring Valley.

Fiscal Cliff Campaign Update

Countdown to Tax Hikes: 22 Days

Countdown to Arbitrary Spending Cuts (sequestration): 24 Days

Need to Know: (action items in this message)

In this message we’re sharing several media ideas and tools that have been developed and utilized within the network. Please take a look, take action today, and tell us what you’re doing (so that everyone will benefit).

I. Big Picture

The media are reporting that momentum is building for Republicans to agree to a tax-rate increase of some level for upper-income taxpayers, which is President Obama’s top priority. There is also growing speculation that Democratic opposition is lessening on some entitlement reforms, such as raising the age for Medicare eligibility from 65 to 67, and changing the index used for calculating inflation for Social Security payments. The oft-quoted mantra for congressional negotiations is that “nothing is agreed to until everything is agreed to,” so no details are close to being final.

Yesterday, Senators Schumer (D-NY) and Menendez (D-NJ) introduced the “Hurricane Sandy and National Disaster Tax Relief Act” that, among other things, lifts the current cap on charitable giving (50 percent of Adjusted Gross Income) for qualified disaster contributions. Once again, policymakers are relying on incentives for giving to alleviate suffering and expedite recovery in their communities.

Tomorrow (Wednesday, 12/12 @ 3:30 – 4:30 Eastern), BoardSource is hosting a webinar on “The Fiscal Cliff’s Twin Threats Against the Work of Charities,” during which we will be sharing our message about how two parts of the fiscal cliff threaten to create massive new burdens on nonprofits and even more work for board leaders. By making funding cuts without reducing the underlying human needs, the demand on nonprofits will increase whilethe resources for providing needed services will decrease. Capping or limiting the value of charitable deductions will further reduce the ability of charitable organizations to meet the increasing need for services. You can share this with your board members and others so they join more than 350 already signed up to learn why they should raise voices. 

Register now to learn more about these potentially devastating threats and what each of us can do NOW to voice our views.  

Also tomorrow (Wednesday, 12/12 @ 1:00-2:00 pm Eastern), several national nonprofits are hosting a conference call on the charitable giving incentive. Speakers include Fr. Larry Snyder of Catholic Charities USA, Diana Aviv of Independent Sector, and Rand Wentworth of the Land Trust Alliance, among others. The call-in number is  712-432-7300: access code 57668#.

II. Network Status Update (Let Tammie Smith know what you’ve done lately)

• Letter to Congressional Delegations: 16 (of 42 State Associations/Nonprofit Allies)
• Action Alerts: 34 (of 42 State Associations/Nonprofit Allies)

• Number of Alerts: 44 (10 State Associations/Nonprofit Allies have sent 2 action alerts)
• NOTE: If you want us to send an Action Alert for you, we can. Just let us know.

• Media Outreach: 7 State Associations/Nonprofit Allies (13 contacts)

• Social Media: 17 Facebook postings

III. Good Ideas

As powerful as our individual stories are, letters and phone calls to policymakers alone will not carry the day. We need the help, engagement, and attention of the news media in the home towns of the elected officials. We offer the following ideas from around the network with the goal of getting rank-and-file Senators and Representatives to tell their leaders: “I’m taking a lot of heat back home; you’ve got to prevent these arbitrary cuts and refuse to cap or limit the charitable deduction””

• Targeted Joint Statements: Last week, leaders of 11 Catholic human service agencies in the Cincinnati area issued a joint statement calling on federal leaders to protect the poor and vulnerable there and abroad in fiscal cliff negotiations. The Cincinnati Enquirer picked up the story and informed all of Speaker John Boehner’s constituents of the potential local impact of the automatic cuts if he doesn’t reach a deal to avert the fiscal cliff.

• Footnote to this story: Our colleague Beth Bowsky, who lives in Cincinnati, had previously shared with the Enquirer the network’s media statement and other materials, perhaps helping to lay the groundwork for the reporter’s interest prior to his receiving the local story from the Archdiocese.

• Media Statements: Several State Association leaders have issued comments to the press or talked with reporters as they prepare stories. The National Council of Nonprofits issued a Media Statementlast week – intentionally designed as a background piece rather than the usual news release. The Statement provides a summary of the broader context, all designed to garner the attention of editors for the issues presented.
• Editorial Board Meetings: Jim White, the new Executive Director for the Nonprofit Association of Oregon, participated in an editorial board meeting at the largest newspaper in the state along with two other nonprofit leaders. They addressed the questions raised, and, through excellent pre-meeting planning, covered all of the key points they wanted to make – using facts, stories, and obvious passion for the community.
• Divvying Up the State: Yes, we want every State Association to be seen as the leader on this issue in the state; but we all know that the local angle is usually the first interest for editorial boards. TheNorth Carolina Center for Nonprofits solved this problem by preparing and sharing materials for their geographically diverse board members to submit to their local news outlets. This week, the Center is following up with any uncovered media markets to ensure that the whole state is covered.
• Tools You Can Use: By all means, take the materials we’ve prepared and modify them for maximum impact in your state: Infographic, Media Statement, Myths vs. Realities, other resources.
• Share: Help us develop the best array of ideas and tools for getting the news media across the country to focus on the impact in communities of the arbitrary cuts and proposals to cap or limit charitable deductions. Share with us and your colleagues the press statements, op-eds, talking points, quotes, etc., that you have developed for media contacts in your states.

IV. Why We’re Fighting

We have received powerful comments from nonprofits throughout the country who have gone to the GiveVoice.org website. Here is a sampling (permission given for naming organizations):

• “We are a nonprofit organization who helps those with cancer at no cost to them or their families.  We rely on fundraisers and donations to stay open with an all-volunteer staff. We are the only organization offering the programs and services in the Tri-State area we live in. We rely on the current charitable giving incentives so we may continue to help those who are newly diagnosed or going through treatments.” We Care Cancer Support Inc., Bullhead, Arizona
• “Soroptimist International of the Central Jersey Coast services the hardest hit area of Storm Sandy. Many of our members have lost homes. Our neighbors are suffering devastating loss of homes, income, and emotional and physical needs. We must have our contributions so we can carry on our work to help women and girls in our community. We help the local women's shelter, girl scout's camp, sexual abuse rape victims, and the local children's hospital. We also give gifts for girl's who volunteer in our community and give scholarships to women rejoining the work force. Without the incentive to donate, our work will be over. Soroptimist International of the Central Jersey Coast, Lakewood, New Jersey

Tax woes troubling future of nonprofit

The Watertown Daily Times reported that a Tompkins County nonprofit land conservation organization is worried it could lose most of its St. Lawrence County property to thousands of dollars due in delinquent taxes because assessors routinely do not recognize its efforts as tax-exempt.

"We try to protect the environment. That's our mission," Common Field Vice President Ibe M. Jonah said. "We're hoping to find a free attorney to impress on the county what we stand for."

Common Field, Lansing, has acquired more than 40 parcels in Central and Northern New York. Most of the property is in Tompkins County, where the organization has run into problems with neighbors, zoning and assessors. In St. Lawrence County, the organization has 16 parcels in 11 locations, many of them purchased at tax sales.

The organization owns 484.45 acres of land in the towns of Brasher, Potsdam, Lawrence, Gouverneur, Fine, Norfolk, Stockholm, Piercefield, Pitcairn and Hammond and the village of Norwood.

Much of the land was acquired by Common Field founder Christopher H. Muka, whose nickname is "Nature Boy," who either sold or donated the land to the nonprofit.

"I know they have applied in towns to be tax-exempt," county Director of Real Property Darren W. Colton said. "That's with the assessor. They have to qualify in the use of the land."

Common Field owes back taxes on most of its properties in St. Lawrence County but isn't in danger of losing them this year, Mr. Colton said. With the exception of one property in the town of Stockholm, all of the other assessors have denied Common Field's annual applications to be tax exempt.

Common Field filed the application for tax-exempt status annually up to two or three years ago, but no longer tries, said Stephen E. Teele, assessor for the town of Hammond, where Common Field owns 16.6 acres off Alamogin Road.

"Most of it, it's under water. It's pretty wet," Mr. Teele said. "There's a little bit of woodland. It's probably worth about $4,000."

To be tax-exempt, the land has to be held for public use, which Common Field says all of its parcels are. The trouble is, the organization does not have signs on many of its St. Lawrence County properties declaring them as public, and many are difficult to reach. The organization does not have a website. Read more here.