Federal Issues Looming
OpEd by Marnie Taylor, President and CEO
Two weeks ago, my staff and I visited with the Oklahoma delegation in Washington, D.C. We were able to have meetings with legislators and staffers for all five congressional districts and our two senators.
The Oklahoma Center for Nonprofits, along with the National Council of Nonprofits and state association leaders from around the country, continue to have concerns about three significant issues that will affect the charitable sector. Nonpartisanship requirements for nonprofits as determined by the Johnson Amendment which bars nonprofit organizations and churches from interfering with elections by endorsing candidates is one of those hot-button issues. I have written about it a number of times before, and the Center continues to believe that the Johnson Amendment protects our sector from unwanted partisan candidate interference so that we may maintain neutrality in our missions and programs.
However, two other issues will have significant effects on the sector should tax reform and budgeting measures pass Congress and be signed into law. The first is maintaining the charitable giving incentives for individuals to donate to charity. Currently, those individuals who itemize on their tax returns may receive a tax deduction for their charitable gifts to nonprofits, churches, foundations, donor advised funds and other charitable vehicles.
Language currently afloat regarding tax reform includes doubling the standard deduction for individuals to simplify their returns. This could reduce the rate of the number of families who itemize from 30 percent to just 5 percent, and this could disincentivize giving, as those who itemize give more to charity. Another proposal that was rumored during the elections last year was to cap charitable deductions at $100,000 for individuals. That would also hurt those large individual gifts for charity, transformative gifts that assist nonprofits with major campaigns or capital needs.
One solution that could help all Americans give and give more is the “universal charitable deduction,” or “non-itemizer deduction.” This would allow anyone who gives – regardless if they itemize or not – an opportunity to deduct their charitable gifts at the end of the year.
Of course, the other hot-button issue we discussed was the federal budget and domestic spending. We reiterated to our delegation the concerns we had about massive cuts to social programs that feed the hungry, house the homeless and provide medical care from cradle to cane. We also let our delegation know that nonprofits and churches would not be able to fill the void should some of the proposed cuts be implemented on a wide scale.
For instance, the White House proposes cutting $193 billion over the next decade ($4.6 billion in FY2018) from the Supplemental Nutrition Assistance Program (SNAP – formerly known as the Food Stamp Program). If adopted as proposed, community service providers will be asked to assist the children, the elderly and veterans who depend on the program. However, to raise the $193 billion to cover the costs would require the nation’s 23 largest foundations — including Gates, Ford, Getty, Robert Wood Johnson, Lilly, Hewlett and Kellogg — to cash out their assets and close their doors forever.
Obviously, we will continue to monitor legislation at both the federal and state levels that could affect the charitable sector. We hope that policy makers will see the benefits of working with nonprofits to create effective, efficient ways to serve all Oklahomans and Americans.