Friday, November 16, 2012
The latest edition of the ACR newsletter is available below and with full articles online.
Upcoming Events
NOVEMBER 29
DECEMBER 4-5
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Join the Effort to Protect America’s Strong Tradition of Giving!
Charitable Giving Coalition’s “Protect Giving – DC Days”
December 4-5, 2012 ~ Washington, D.C.
Deadline to register is today, November 16. RSVP to William@acreform.com.
Please join us for the Charitable Giving Coalition’s inaugural Capitol Hill fly-in event – “Protect Giving – DC Days”! This is a great chance to meet with policymakers and their staff to explain the impact that a cut/cap/limit on the charitable deduction would have on your program and the people you serve.
With the post-election “lame duck” session of Congress shaping up to be the time when policymakers will make final decisions on how to address the end of the year fiscal issues, slashing or limiting itemized deductions, including the charitable deduction, remains a popular proposal for raising federal money.
This is not news for many of you. But now it's crunch time. The stakes have never been higher. It is critical that policymakers hear from us NOW before final decisions are made and unintended consequences take root. That’s why the Charitable Giving Coalition is encouraging you to participate in our Protect Giving – DC Days. Our goal is to have participants attend, representing a broad swath of the nonprofit sector including private and community foundations, their grantees, and independent charities.
For additional information about the event click here: http://acreform.com/article/charitable_giving_coalitions_protect_giving_dc_days/
Please RSVP to William@acreform.com by Friday, November 16, 2012.
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ACR Blog Roundup
The ACR blog (www.acreform.com/blog) highlights our thoughts on news of the day. For regular updates from our blog, follow us @acreform on Twitter.
Here is a roundup of the ACR blog since the last newsletter edition:
The following blog postings by Sue Santa, Senior Vice President for Public Policy at The Philanthropy Roundtable, first appeared on The Hub, an online community for registered participants of the Independent Sector’s Annual Conference.
Tax Reform and the Perfect Storm
Laying out the current situation facing Congress (the “fiscal cliff” at the end of the year, deficit reduction and tax reform) Santa explains the threats to incentives – particularly the charitable deduction – and invites conference participants to attend a discussion on the implications of tax reform on our sector.
Protecting the Charitable Deduction – A United Front
Santa highlights key takeaways from the policy conference: the nonprofit sector is unified in its defense of charitable giving and it’s critical we make the case to elected officials that limiting incentives to give will hurt those we serve.
Washington Roundup
Congress returned to Washington this week. They’ll take off the week of Thanksgiving then return on Tuesday, November 27th to tackle the looming fiscal cliff.
In addition to the current Members of Congress, the 92 newly elected freshman class traveled to the Capitol for a new-member orientation this week. Democrats retain control of the Senate and picked up two seats there. In the House, Republicans maintain control with a slight narrowing of their margins: from 242-193 in 2010 to 233-194 in 2012. As of this writing a number of races for House seats have not yet been called.
Congress is Back in Action
In this lame duck session Congress must determine what (if anything) to do about the fiscal cliff, mandatory spending cuts and tax increases that are set to take effect on January 1, 2013. Both parties wasted no time getting their message out. On Wednesday, November 7th, just one day after the election, Senate Majority Leader Harry Reid (D-NV) said
Congress should reach a long-term solution on the fiscal cliff in the lame-duck session: “I am not for kicking the can down the road. I think we've done that far too much. We know what the issue is and we need to solve it.” The Majority Leader left open a door for compromise, going on to say, “I'm not drawing lines in the sand and [Speaker Boehner is] not going to draw any lines in the sand, we are going to work together.” Speaker of the House John Boehner (R-OH) built
on this idea of compromise, saying... (continued)
What the President is Saying
The President spent this past week meeting with several groups regarding the fiscal cliff. On Tuesday, November 13th and Wednesday, November 14th, President Obama met with labor and business leaders, respectively, to gain their input on how his administration should handle the cliff. They all delivered the same message: do not let our country go over the fiscal cliff. The President responded without offering specific details, but reiterated
that he would not allow tax cuts for the middle class to expire and was committed to a balanced approach of reductions in entitlements and other government spending and increases in revenue. While business leaders were pleased with the Administration reaching out, one executive tempered that enthusiasm saying “I’d say everybody came away feeling pretty good about the whole discussion, [but] all of us are C.E.O.’s, so we’ve learned not to confuse words with results. And that’s what we still need to see.” (continued)
ACR’s Position
Just to remind our readers: During this lame duck session, ACR joins its colleagues on the Charitable Giving Coalition to oppose any cap on the charitable deduction.
Peter G. Peterson Foundation Solutions Initiative
Five prominent thinks tanks – the American Action Forum, the Bipartisan Policy Center, the Center for American Progress, the Economic Policy Institute and The Heritage Foundation – released plans on Thursday for avoiding the fiscal cliff and dealing with the deficit, as part of the Peterson Foundation’s 2012 Fiscal Summit. Of particular note, four of the think tanks suggest replacing the charitable deduction with a credit (as part of reforming all so-called “tax expenditures”), while the Heritage Foundation advocates eliminating all tax expenditures. A full review of these studies can be found
here.
Consider This
Top Ten Takeaways from the Election
1) It's over! We could not take one more minute of it. Truly.
2) The party that is perceived as the overall winner in any election almost inevitably overreaches. Let's see what happens this time.
3) Obama is the first President since the 19th century to win with a lower percentage of the vote in his second-term victory.
4) For Washington insiders, the biggest surprise of the evening was not the Presidential, but the race for the Senate... (keep reading)
Making Headlines
Tax Reform/Charitable Deduction
Fiscal Cliff: The Congressional Budget Office predicted that going over the fiscal cliff would shrink the economy by 0.5 percent in 2013 and drive unemployment to 9.1 percent.
Democrats and Republicans havespoken out in the press on tax increases or reducing deductions to avoid the fiscal cliff. Many lawmakers are warming
to the idea of capping deductions, others in Washington raise caution. In the standoff between both sides the nonprofit sector continues to educate
lawmakers on the potential dangers of any limitations to the charitable deduction (including the idea floated by Governor Romney capping all deductions for high-income earners to a specific the dollar amount). Steve Taylor of United Way Worldwide explains
to Bloomberg: “Charitable contributions are the most discretionary for taxpayers. Many taxpayers would reach a cap on deductions with state and local taxes and mortgage interest, effectively eliminating any tax incentive for charitable giving." For a soup-to-nuts primer on the fiscal cliff, view notes from ACR’s recent Election Impact Briefing.
Also see:
Charitable Deduction: Efforts are underway across the charitable sector to urge policymakers to preserve the charitable deduction.
Visit our Charitable Deduction Central for news, opinion, background and updates on the Charitable Giving Coalition’s efforts to protect the charitable deduction.
States/Local
Tax Credits: The Chronicle of Philanthropy explores ways different states treat tax incentives for gifts to charity.
Research
Private Foundation Payout: The Foundation Source’s new report on foundations with assets under $50 million finds that private foundations consistently gave more than the 5% annual distribution required by federal law with disbursements for grants and charitable expenses averaging 11.6% of assets between 2008 and 2011. Report: The Foundation Source First Annual Report on Private Foundations
Donor Advised Funds: A report from the National Philanthropic Trust finds that donor-advised funds (DAFs) continued to grow in 2011, with total assets under management rising 17.5 percent to $37.43 billion last year (above the pre-recession high of $30.59 billion in 2007) and total grants made by DAFs increasing 13.6 percent to $7.7 billion. Report: 2012 Donor-Advised Fund Report
This Caught Our Eye…
Advice to the President: Joining other nonprofit sector leaders in offering advice to the president on how to ensure a healthy sector Adam Meyerson, president of The Philanthropy Roundtable, suggested challenging Americans to increase charitable giving from 2 percent to 3 percent of gross domestic product, which would generate an additional $150-billion a year.
Civil Society: Examining the transitions to democracy of post-communist countries the Washington Post provides a lesson on why civic organizations and activism are key and underscores the value of civil society to America.
B-Corps: In its Fall 2012 newsletter Reid & Riege discusses the topic of benefit corporations and explains what nonprofits need to know about b-corps.
Disaster Preparedness: Drawing from their experience with Hurricane Sandy, Philanthropy New York shares important lessons on how all organizations can prepare for, recover from and get business operations back on line following a natural disaster.
Philanthropy’s Role: Blogging about his presentation to the Florida Board of Education David Biemesderfer, President and CEO of Florida Philanthropic Network, explains the that philanthropy is not a replacement for government, noting “…philanthropy is at its best when it invests with great precision, finding the sweet spot, testing it, pushing it, proving it. Then, the larger community forces can determine whether, and how, to expand and grow what philanthropy has planted.”
Nonprofit Leadership: Robert Egger announced last month that he was stepping down from heading DC Central Kitchen, which he founded over two decades ago, to open a similar project in Los Angeles called L.A. Kitchen.
Charity’s Role: A New York Times op-ed questions whether Americans will continue to contribute to charity at the same levels if the charitable deduction is reduced to help pay for deficit reduction.
Social Media: The Wall Street Journal explores the challenges to charities and donors of using social media to give.
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