ACR Newsletter

2009 in Review

ACR’s accomplishments for 2009

Highlights from 2009

Stopping Cuts to the Charitable Deduction

Early in 2009, ACR sprang to action opposing an Administration revenue raiser limiting individuals’ itemized deductions, and specifically limiting the charitable deduction.  As you may recall, this revenue raiser was an integral part of President Obama’s budget to fund healthcare reform.  Complicating our effort was that several Senators immediately supported the President’s revenue raiser and proposed various versions of it to help fund various healthcare reform bills. 

ACR, along with a newly formed coalition (the Charitable Deduction Coalition), provided the crucial opposition.  These opposition efforts ranged from providing witnesses to testify at Congressional hearings about the risks associated with cutting the charitable deduction to persuading Senators to sign on to a letter, led by Senator John Thune (R-SD), in opposition to charitable deduction cuts.  Due, in no small part to the efforts of ACR and the coalition, neither the Senate nor the House included the Administration’s revenue raiser to pay for healthcare reform bills.  While stopping these cuts is important, equally important was the process of finding common ground with organizations ACR has not had the opportunity to work with before on policy matters. 

We were able to build on our early success and good working relationships with coalition members a few months later as we gathered once again to work with House and Senate offices on financial reform legislation that created a new regulatory agency … 

Fending Off Legislation that Creates a New Regulatory Agency

In the wake of the financial crisis, Congressional Democrats and the Obama Administration began work on a new financial regulatory structure.  As part of that overhaul, both the House and Senate began work on a new Consumer Financial Protection Agency (CFPA) to regulate “consumer protections” relating to financial products, services, and activities. 

According to the legislation, organizations engaged in “financial activity” would be subject to CFPA authority which includes potential certification/registration/examination processes and fees.  In the original versions of the legislation in the House and Senate, the definition of “financial activity” was very broad and would have potentially subjected certain nonprofits to CFPA authority because of their fundraising efforts, as well as their missions to provide financial education.  Because of the potential impact upon nonprofits, ACR quickly put together a team to alert the community and identify allies and notify key Congressional offices. 

To date, we have successfully negotiated changes to the House of Representative’s version of the bill to exclude provisions that clearly over-reach while maintaining the integrity of the bill.  Towards that end, ACR worked with key House Members, along with a coalition of interested community members, to successfully clarify language in the House legislation that nonprofits’ charitable giving activities (solicitation of/communications with donors, etc.) would not trigger CFPA regulation. 

The legislation is now set to work its way through the Senate process.  ACR is currently working with the staff of the Senate Banking Committee to address our concerns, including mitigating the potential impact of this legislation on nonprofits offering basic financial education – from local schools and churches holding classes on how to balance a budget to shelters and missions offering basic steps out of poverty toward self-sufficiency—as part of their missions. 

Good Giving Legislative Platform

Led by ACR’s Strategy Committee, ACR began 2009 by creating a “Good Giving” legislative platform.  The audience for this platform was Members of Congress and included recommendations to incentivize philanthropy.  With this in hand, ACR met with Congressional offices to highlight and share the important role of philanthropy.  A copy of this platform can be found here.

Advancing Philanthropic Freedom

One of ACR’s key roles is to provide a balanced voice on policy matters that affect its members.  Last year ACR was particularly challenged by groups such as the Greenlining Institute and the National Committee for Responsive Philanthropy (NCRP) who aimed to influence the political process to limit philanthropic freedom, that is the right of donors and foundations to give of their financial and other resources as they choose, consistent with the law.  For example, in “Philanthropy At Its Best,” the National Center for Responsive Philanthropy recommended “guidelines” for grantmakers that, if codified by lawmakers, would require foundations to meet giving targets to certain groups.  This is wholly inconsistent with philanthropic freedom. 

Upon learning of this report, ACR quickly gathered a diverse group of private donors and charitable organizations to provide a counter-balance to NCRP’s recommended guidelines that highlighted the importance of diverse charitable missions and the freedom to support those missions.  This counter-balance was critical in illustrating the risks posed by NCRP’s recommendations to the broader community.

Adding to ACR’s intellectual capital, The Philanthropy Roundtable released a monograph that explored the question of whether foundation funds can be considered “public money” because they are exempt from federal taxes.  This in-depth exploration of the issue demonstrated that it is deeply problematic to consider the federal tax exemption and the charitable tax deduction as subsidies, and even more problematic to assert that the public has a legitimate claim to private philanthropic assets. A full copy of the report can be found here.  ACR shared the findings of the monograph with federal legislators to help advance our position supporting private philanthropy.

A Resource for Policymakers

ACR continues to be a resource for policymakers, from identifying witnesses for hearings in Congressional Committees to providing background information and statistics on issues to drafting background briefings for Members of Congress.  As Congress moves into the second session of the 111th Congress, we plan to expand these relationships and continue our outreach efforts to broaden our Congressional allies. 

Model State Legislation

In 2008, the American Legislative Exchange Council (ALEC), approved a set of principles that support philanthropic freedom.  ALEC is a membership organization for state legislators that, among other things, provide their members with “model” legislation they can consider for their own states.  The principles adopted in 2008 essentially protect foundations’ missions and the principle of donor intent.  Adding to this earlier effort, ALEC adopted model legislation in December of 2009 that provides statutory language to protect philanthropic freedom for state legislatures to consider.  ACR is currently working with several key state legislatures as they consider advancing this model legislation. 

Strengthening Communications and Outreach

ACR launched a broader, more strategic communications plan and initiated several new pursuits to define ACR’s message and deliver that message to a broader audience in new ways.  ACR’s communications development strategy included: commissioning a communications firm to conduct focus group research and develop a general plan for future communications; working with the communications firm to craft coherent messaging that can be used in print, talking points, speeches and other opportunities; and, identifying new networks to deliver that message.  ACR also incorporated the research and plan into its redesigned website (http://www.acreform.com), which also included the refreshed ACR logo, launched in late September.  The new website has greatly expanded capacities that will be launched as need arises.  We hope this redesign enhances your experience at the website.  In addition, you can stay in touch with ACR and receive information about events through our Facebook fan page.

In addition to our communications tools, ACR staff was busy this year sharing our messages in a number of different community forums.  From the Southeastern Council of Foundations to the Foundation Financial Officers Group, ACR was offered many great opportunities this year to speak directly to community groups.  Additionally, ACR Strategy Committee Members also participated in outreach events, providing even more avenues to share ACRs positions.  These opportunities helped ACR develop allies and grow our supporters.  If you are interested in hosting an event and would like ACR staff to come speak to important issues affecting the nonprofit sector, please contact staff (.(JavaScript must be enabled to view this email address)), and we will work with you on setting up an event. 

2010 Prospective Initiatives

In addition to remaining active on federal and state policy issues and expanding ACR’s coalition, we plan to unveil three new initiatives for 2010: 

In March, ACR will convene a Leaders’ Summit in Washington D.C.  to hear from senior Congressional staff about the legislative agenda for 2010 and its impact on the non-profit sector.  We also are planning a panel featuring thought leaders and their “Big Ideas” to advance philanthropic freedom. 

Building upon the discussions and panels at the March ACR Leaders’ Summit we plan to explore the possibility of developing legislative proposals that support philanthropic freedom.

In addition to our efforts at the federal level, ACR is pursuing legislation at the state level based on “model” legislation that protects philanthropic freedom endorsed by the American Legislative Exchange Council (ALEC).