In This Week's Edition of Snapshot:
- President Delivers First SOTU, Congress Reacts
- Mnuchin Urges Action on Debt Limit as Congress Seeks to Prevent Another Shutdown Next Week
- Tax-Writers in House Continue Work Post-Tax Reform
- HUD and COF Launch Exchange Highlighting Public-Philanthropic Partnerships
- USDA Announces 2018 Legislative Principles
- In the States: Colorado Considers Expanding Endowments
On Tuesday evening, President Donald Trump delivered his first State of the Union (SOTU) address to a joint session of Congress. In his speech, the President called for bipartisanship, stating, “Tonight, I call upon on all of us to set aside our differences, to seek out common ground, and to summon the unity we need to deliver for the people. This is really the key.” He went on to name a number of issues that he hopes to address with bipartisan support, including infrastructure and immigration.
On both of these issues, however, there has yet to be agreement—particularly with regard to immigration. Last week, the Trump administration announced an immigration framework as a counter-offer to the bipartisan plan presented by a group of senators prior to the government shutdown. This framework was rejected by Democrats shortly after it was released, and it remains to be see if a new deal can be agreed upon.
On Wednesday morning Council staff attended an Axios event to hear SOTU reactions from Members of Congress on both sides of the aisle—including Rep. Steny Hoyer (D-MD), Sen. Susan Collins (R-ME), and Rep. Adam Schiff (D-CA). Though the group presented mixed feelings about the President’s SOTU address, there was consensus that Congress and the Administration must come to an agreement on immigration to avoid another government shutdown (see next section for more details).
Yesterday, Treasury Secretary Steven Mnuchin urged Congress to lift the debt-ceiling—the total amount of money that the United States government is authorized to borrow to meet its existing legal obligations—so that the federal government can continue to pay its obligations.
According to Reuters, “In a letter to congressional leaders and key committee chairmen, Mnuchin said the Treasury Department would continue to suspend payments into federal employee retiree, health, and disability funds through Feb. 28. Congress must raise the nation’s debt ceiling to avoid a government default. The nonpartisan Congressional Budget Office [CBO] has estimated that the U.S. Treasury would exhaust its borrowing options and could run out of funds to pay its bills by late March if lawmakers do not act.”
CBO further clarified that the debt limit will need to be raised in early March. In the report they noted, “After incorporating the anticipated effects of recent tax legislation and actual spending and revenue amounts in December into its calculations, CBO now projects the range of possible dates as falling earlier in March.”
This comes at a time when Congress is struggling to find a way to fund the government for fiscal year 2018, which began on Oct. 1, 2017. According to POLITICO, “Doubts are growing on Capitol Hill that Republicans and Democrats can reach a long-term budget deal by Feb. 8, when the government will once again run out of money. Party leaders are already pointing fingers at each other, a discouraging sign for the long-stalled talks that could lead to more short-term funding measures both parties loathe.”
The current continuing resolution funds the government through Feb. 8. Without an agreement, the country would see the government shut down for the second time in less than a month.
On Tuesday, the House Ways and Means Oversight Subcommittee held a hearing to discuss Committee members’ ideas for improving “tax administration” by reforming the Internal Revenue Service (IRS). The conversation focused primarily on ways to improve responses to taxpayer questions and embracing new technological advances to bolster cybersecurity capabilities. Many members’ ideas involved ways to improve the existing structure of the IRS, but Reps. Louis Gohmert (R-TX) and Jason Smith (R-MO)—proposed more extreme ideas that involved implementing an entirely new tax-collecting/auditing regime in place of the IRS.
Beyond this hearing, GOP members of the Ways and Means Committee are scheduled to attend a half-day retreat on Feb. 6 to map out their legislative agenda for the remainder of 2018. Given that seven of the 24 Republican Committee members will be leaving Congress at the end of this year (including Rep. Pat Meehan, R-PA, who recently announced he would not seek reelection), this retreat will provide a sense of what type of follow-up the Republicans on Committee hope to undertake this year with regard to the tax legislation that passed late last year.
Earlier this month, the Council in partnership with the U.S. Department of Housing and Urban Development (HUD), launched an online-exchange highlighting public-philanthropic partnerships. Council Vice President for Policy and Partnerships Stephanie Powers said of the project, "The Council is pleased to launch this new online community of practice into our ongoing partnership portfolio with HUD's Office of International and Philanthropic Innovations. Over the past six years of the awards program, we have seen the potential of creating a network for learning across the fifty projects, and using a digital platform designed and curated for social learning and collaborative problem-solving brings them together in real time. There is a treasure trove of experience and lessons to share."
According to HUD’s press release, “Since 2012, 50 foundations have received a Secretary’s Award for their efforts to collaborate with public sector partners. This innovative group of funders and government partners represents a diverse pool of perspectives, interests, and experiences. … To better tap into this expertise and create new opportunities for learning and exchange among foundations and their public partners, HUD and the Council on Foundations launched the Excellence in Public-Philanthropic Partnerships Exchange. The Exchange is a community of practice that will support and improve public-philanthropic partnerships by creating a space for foundation and government representatives with proven track records for innovative collaboration to exchange ideas, information, lessons learned, research, tools, and other resources. All previous Secretary’s Awards winners—foundations and government partners—are invited to participate in the exchange.”
Last week, U.S. Department of Agriculture (USDA) Secretary Sonny Perdue announced the department’s legislative principles for the 2018 Farm Bill. According to a USDA press release, “‘Since my first day as the Secretary of Agriculture, I’ve traveled to 30 states, listening to the people of American agriculture about what is working and what is not. The conversations we had and the people we came across helped us craft USDA’s Farm Bill and Legislative Principles for 2018,’ said Secretary Perdue. ‘These principles will be used as a road map—they are our way of letting Congress know what we’ve heard from the hard-working men and women of American agriculture. While we understand it’s the legislature’s job to write the Farm Bill, USDA will be right there providing whatever counsel Congress may request or require.’”
The principles touch on topics including: Farm Production and Conservation; Trade and Foreign Agricultural Affairs; and Food Safety and Inspection Services.
Exclusive from our colleagues at the National Council of Nonprofits.
Colorado Considers Expanding Endowments
A bipartisan bill in Colorado seeks to promote giving to support the ability of nonprofits and foundations to continue to meet the growing needs in the state. The Colorado Nonprofit Sustainability Act would create a tax credit for cash donations to endowments of charitable nonprofits and community foundations, providing greater charitable giving incentives for organizations in the state. Under the bill, donors would be allowed to claim a 25 percent tax credit for donations up to $20,000. Nonprofits would receive $4 for each dollar the state awards in tax credits. The recipients would be required to provide verification of the donor’s identity and that the donation qualifies for the credit. Five other states (Iowa, Kentucky, Maryland, Montana, and North Dakota) currently offer a tax credit for donations to charitable endowments.
Eligible funds must be held by (or on behalf of) Colorado-organized and operated nonprofits and community foundations, including endowments established by board-restricted assets and endowments subject to donor restrictions. The endowment funds would have to be managed directly by nonprofits, foundations, or foundations on behalf of nonprofits. The assets must be invested to grow in value, sustain nonprofits’ operations, and support their long-term goals. As envisioned in the legislation, the funds preserve principal and spend income to make grants or provide direct services to communities. Boards or donors retain the authority to set restrictions on the fund’s duration and how assets are to be used. The Colorado Nonprofit Association is circulating a letter in strong support of the measure and inviting organizations and individuals to sign on to demonstrate broad support within the state.