Council on Foundations Legislative Network

Update– May 12, 2008

 

In this Update

 

House Leaders Plan to Introduce Extenders Package
House Democratic leaders may introduce their own version of an extenders package this week. The measure is likely to extend tax provisions for one-year that expired at the end of 2007, including the IRA charitable rollover and renewable energy tax credits. (The renewable energy tax credits will expire at the end of this year.) House Majority Leader Steny Hoyer (D-MD) said “We are interested in pursuing tax extenders and energy solutions. We want it paid for and it will be paid for.” However, a short-term fix to the alternative minimum tax (AMT) is not expected to be included in the bill because of high costs. House Ways and Means chairman Charles Rangel (D-NY) has not yet released how the House will pay for the extenders package. Chairman Rangel is working with the Senate to develop and finalize a measure that could be passed by both chambers.

The Senate Finance Committee is expected to consider the two-year extenders package—The Alternative Minimum Tax and Extenders Tax Relief Act of 2008 (S.2886) in the first week of June. The proposed bill was introduced by Senate Finance Committee Chairman Max Baucus (D-MT) and Ranking Member Charles Grassley (R-IA) on April 17. The package proposes to extend the IRA charitable rollover through 2009 as part of a package of tax incentives that have expired or are expiring. The legislation would extend the IRA charitable rollover provision in its most recent form allowing individuals to take tax-free distributions from their IRAs (up to $100,000 per taxpayer per taxable year). 

Take Action Now: The Council on Foundations supports the charitable giving incentives in S.2886. Congress is expected to take action on the tax extenders package before the Memorial Day recess. To date, S.2886 has 12 co-sponsors in the Senate. The more co-sponsors a bill secures the more likely it will pass.  Please use the Council’s Policy Action Center to send an email to your senators by Friday, May 23 asking them to support the extenders package.

The Council will continue to monitor the developments of the House and Senate extenders legislation and will provide the Legislative Network with an update. If you have any questions, contact Luis Maldonado or Chatrane Birbal in our Public Policy and Research Department. Contact Luis at Luis.Maldonado@cof.org or 703-879-0688 and Chatrane at Chatrane.Birbal@cof.org or 703-879-0689.

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Farm Bill Conferees Reach Agreement

Conferees of a new five-year farm bill announced that they have reached an agreement, which they will likely send to President George W. Bush next week. Some congressional members and President Bush have already expressed opposition to the agreement.  President Bush is seeking tighter limits on farm subsidies and has previously opposed a $3.8 billion farm disaster aid program and new benefits for the sugar industry. Most recently, the president has reiterated his concern that the bill is too expensive. Conferees will need significant support from House Republicans to override an expected veto by the President. 

 

The proposed agreement would prevent the wealthiest farmers from receiving government subsidies and would limit the amount of money farmers could get each year.  Lawmakers expect the total cost of the bill to be about $10 billion more than what it would cost to extend current law, although they are still awaiting a final score from the Congressional Budget Office.

 

Highlights in the package include: reductions in direct payments (subsidies farmers get regardless of crop prices) by $400 million; a Conservation Stewardship Program, which would provide incentives for adopting, improving, and maintaining sound conservation practices on land in agricultural production; a Rural Microenterprise Assistance Program with $15 million in mandatory funds, which would provide technical assistance and small loans to new entrepreneurs to help start businesses in rural areas; and the new disaster fund for farmers who lose crops to droughts, floods, or fires.

 

Read the Senate Agriculture, Nutrition and Forestry Committee’s press release on provisions of the conference agreement. The conference report is expected to go to the House floor as early as this Wednesday for debate. The Council will continue to monitor progress on the farm bill and will provide the Legislative Network with an update.

 

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IRS Posts E-filing Requirements for Small Exempt Organizations

The Pension Protection Act of 2006 contains a provision that requires small nonprofits with annual gross receipts of $25,000 or less to file a new Form 990-N (otherwise known as e-postcard) if the organization had been exempt from filing the Form 990. The Internal Revenue Service has recently posted on its website the electronic filing requirements for small exempt organizations. The IRS provides information on which organizations need to adhere to the new requirement and provides in depth information on what should be reported in the form. The due date for filing the form is the 15th day of the 5th month after the close of an organization’s tax year. For organizations that fail to file the notice for three consecutive years, their tax-exempt status will be revoked.

 

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Congressman Becerra Discusses Diversity and Inclusiveness in Charitable Organizations at the Council’s Leadership Summit

In light of recent legislation in the California State Assembly, a panel focusing on diversity and inclusive practices within the philanthropic sector was convened for the first time last week during the Council’s leadership summit. The legislation in question, Assembly Bill 624, would require California foundations with assets of more than $250 million to collect ethnic and gender data related to their governance and grantmaking practices. Specifically, the bill would require a foundation to collect and report data on the racial, ethnicity, and gender composition of members of its board of directors or trustees, staff, grantees, and business relationships. The bill would also require the foundation to disclose the number, amount, and percentage of grants awarded to organizations where 50 percent or more of the board and staff members are ethnic minorities.

 

Panelists included the following experts: Adam Meyerson, President Philanthropy Roundtable; I. King Jordon, Director Theodore R. & Vivian M. Johnson Scholarship Foundation; Robert K. Ross, M.D., President and CEO, California Endowment and Chairperson, Diversity in Philanthropy Project; Ann Wiener, Trustee, Jessie Smith Noyes Foundation; and Representative Xavier Becerra (D-CA).

 

The main point of discussion focused on whether the sector needed a legislative mandate such as A.B.624 to ensure diversity in charitable grantmaking or if the sector exemplifies voluntary leadership. There was a consensus among the panelists that diversity and inclusive practices are important and has a direct relationship to effectiveness of the charitable sector and grantmaking. The panelists applauded foundations that have already illustrated voluntary leadership to ensure that decisions are made as it relates to their diversity practices and grantmaking operations. The panelists indicated that a legislative mandate is not needed.

 

The panel also recommended that diversity should not only include race and gender but also those with disabilities. Representative Becerra, commenting on the sector’s diversity practices, said, “much still needs to be done, however progress has been made to include a diverse group in the sector.” Becerra also warned that the sector receives a $32 billion earmark for charitable purposes each year, which should go to a diverse population and that those funds are under a microscope “so do well.”  In other words, Congress will be watching the sector to ensure that taxpayer dollars are used for underserved communities and for other charitable purposes.

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Congressional Schedule for this Week
The House and Senate will be in session this week, May 12–16.

 

House

The House will take up a final version of the five-year farm bill (H.R.2419). The measure would reauthorize federal farm, nutrition assistance, rural development, and agriculture trade programs. In addition, the chamber will consider a war supplemental spending bill that would fund the wars in Iraq and Afghanistan as well as expand GI Bill education benefits for veterans.

 

The House Ways and Means Committee has not yet announced any hearings.

 

Senate
If the House completes action on the farm bill conference report, the measure could move to the Senate floor this week. The Senate is also likely to consider a bill that would reauthorize the National Flood Insurance Program through fiscal 2013 (S.2284).

 

The Senate Finance Committee will hold a hearing on Tuesday, May 13th titled, “Cracking the code—Tax Reform for Individuals.” Witnesses include Dr. Leonard Burman, Director, Tax Policy Center and Senior Fellow at the Urban Institute; Dr. William Gale, Vice President and Director, Economic Studies, Brookings Institution; Stephen Entin, President and Executive Director, Institute for Research on the Economics of Taxation; and Dr. J.D. Foster, Norman B. Ture Senior Fellow, Economics of Fiscal Policy, The Heritage Foundation.

 

Legislative Network is a service of the Government Relations and Public Policy Department at the Council on Foundations. 

 

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